Thursday, February 15, 2007

Google AdWords Changes

Andy Beal is reporting that Google is making a few significant changes to its AdWords program. The first is that they will expose the Quality Score behind each ad. The second is that they are making some changes to how that score is determined.

Google has always been very clever about the way it decides the order in which it is going to show ads for a particular keyword. Competitors (up until recently) simply placed the highest-bidding advertiser on top, the 2nd highest next, and so on. Since search engine marketing is a pay-per-click system, this didn't really do the publisher much good. A highly-bid, unattractive ad won't get a click and placing it in the prime spot is a waste. Instead, Google did some complicated math problem to determine how "good" an ad was, multiplied that by the bid and used that to figure rank.

Of course, Google likes to keep all things secret, much to frustration of its customers (many of whom have built their entire business upon this black box). There has been a slow, but steady, effort at the company to open up more of the details of its business, and this is bound to be a welcome addition.

But: they are also sending people into yet-another-tailspin, by also changing the way that score is determined, which--naturally--will shuffle the order of the ads. Andy's right: people will complain, but others will also brag. Whenever Google makes a change, you can be sure that a number of agencies will announce that there was no effect on their business. That is, they have something more solid in place, and I tend to believe it.
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