The Account Quality Score: Money Pit for the Uninformed

In last week's column I tried to demystify the topic of PPC Quality Scores (QS) -- those factors that grant some keywords a "love factor" that can result in better ad position at a lower CPC. That column advised advertisers not to worry about the intricacies behind how the search engines determine QS -- the best offense and defense is to "do the right thing" - mainly create small, tight ad groups with keywords in the ad text.

While the principles and advice in that column apply to all of the "big three" search engines, there's one QS factor that's only part of Google AdWords: the Account Quality Score. It affects keyword minimum bids -- the bid prices Google says are the lowest ones Google will accept in order for a keyword to be eligible for ad display. Late last year, many advertisers noticed minimum bids suddenly skyrocketing, and a shout arose throughout the blogosphere that has still not died down.

The outrage was stoked by the fact that the minimum bid increases seemed to be arbitrary and, in many cases, applied to keywords that seemed to adhere perfectly to the QS best practices guidelines Google had recently published.

My agency was bitten hard. We had launched a new AdWords campaign to drive interest in a book that was soon to be published by a major New York publishing house.

The day after we pushed the switch to activate the AdWords campaign, we noticed something baffling: minimum bids for many keywords were $5.00-$10.00. Most maddeningly, many of the keywords affected seemed to be our best possible ones -- for example, the ones in the ad group that consisted solely of a few keyword variations of the name of the book, with ad text that included the name of the book, and clicks landing on the book's site page that was most heavily-laden with mentions of the book title.

We tried discussing it with Google -- and were told to follow the published steps for improving quality score. Tipped off that the problem might be due to the undocumented Account Quality Score, we created an entirely new account and poured the previous campaigns, ad groups and keywords into it. Within days we were suffering from the same old problem: absurdly high minimum bid prices for our most pertinent words.

It took another few months of sleuthing and talking with a variety of industry experts to determine the root problem. Hopefully our findings will help you avoid similar pain. Warning: the following explanation is still undocumented by Google, so it could be "off" in part -- but not far off.

As I mentioned in the last column, QS calculations are based on an AdWords account's history -- how well the account's campaigns have performed over time, especially in terms of CTR. So accounts can "earn" better and better QS over time as the advertiser optimizes the campaigns by optimizing ad text, splitting ad groups into smaller ones, etc. -- by adhering to the best practices I've detailed in previous installments of this column.

But what about new accounts? Since there's no CTR data on which to base QS - how does Google determine minimum bids?

Initial Quality Score for New Accounts

Google does so by using the only data it has: data on how well keywords have performed for other advertisers in the past. For a brand new account, there's obviously no history for keywords in relation to particular ad text and landing page combinations a new advertiser is using. So those usual components of QS are ignored until their influence on a keyword's performance can be determined -- after enough impressions and clicks have accumulated.

Sounds reasonable enough, right? Well, sharp readers will have already detected some flaws in this methodology. For example, how does Google account for words with several synonyms? But here's the issue most pertinent to today's premise: how does Google assign initial QS for keywords that have little or no history? Into this category would fall many important keywords: book and movie titles, for example. Another important one would be brand names of new products.

It turns out that this is the main source of many advertisers' minimum bid problems. Keywords with low search volume history are assigned super-low quality scores, and hence high minimum bids. But that's not the worst of it.

An account's Account Quality Score is the average of all individual keyword quality scores. So if a new account includes many keywords with low search volume history, that account can start off with a low Account Quality Score, which can have a negative effect on all campaigns and ad groups in the new account - even ones that include well-constructed ad groups with high-search-volume keywords. That's the reason seemingly great ad groups are "dinged" with inappropriately-high minimum keyword bids.

Fortunately, this situation can be avoided pretty easily. Build out your new accounts as usual. But pause ad campaigns (or ad groups) that might include keywords with low search volume history. In other words, start with the ad groups that include keywords that are most likely to earn high quality score right away. After the ad groups have exhibited good-to-high CTRs, then start gradually activating campaigns and ad groups that are more "iffy."

I've run out of space to give examples this week, but I'll start next week's column with some solid illustrations. Meanwhile, let me know your comments and questions via the feedback form below.

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