New(ish) Need-to-Know about Google AdWords & Ranking

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October 28, 2013

I literally laughed out loud after typing “New Need-to-Know about AdWords.” So, I changed “New” to “New(ish).” In the PPC world, if it didn’t happen five minutes ago, it’s old news.

There is, however, a pretty huge and recently rolled-out change that shook our PPC worlds at Luna. It was the kind of announcement that elicited the following response:

Ok…you don’t need to watch all six minutes and 32 seconds, but you get the idea. This update is pretty mind-blowing.

Ad Extensions now play a role in calculating Ad Rank

What!? Yes. Google announced earlier this week that they’ve updated their system for ordering ads on the SERP. Prior to this update, the only factor determining Ad Rank was Max CPC and Quality Score. Now, Google takes into consideration the expected impact from ad extensions and formats.

On top of that, they’ve “increased the importance of Ad Rank in determining whether your ad is eligible to be displayed with extensions and formats.”

This is huge, as Google doesn’t make these types of changes nearly as often as they roll out new products. It’s a great change and opportunity for advertisers with extremely relevant ads who have put thought and strategy into their Ad Extensions (shameless plug to a previous article). What’s that one saying? If it sounds too good to be true…

Upon further reading I caught this line, “You may see lower or higher average CPCs in your account.” That’s interesting. Why would this happen, you ask? CPCs may increase “because of an improvement in ad position or increased competition from other ads.” My emotions went from “Woah” to:


While there is the possibility of lower average CPCs if your Ad Extensions are highly relevant, I’m extremely skeptical. My theory is that an advertiser who doesn’t have Ad Extensions and is aware of this change won’t want competitors serving over them and will therefore incorporate Sitelinks, Call Extensions or another ad extensions available. This increase in relevancy makes the space much more competitive. 

What happens when there is an increase in competition? Everybody. Pays. More.

Share this information with your fellow coworkers or clients so that they can mentally prepare themselves to get the same amount of traffic at a higher cost. Don’t forget to leave SEO out of the conversation because they need to know that their jobs are going to become more difficult because Ad Extensions are known for…taking up real estate on the SERP.

For advertisers who don’t have Ad Extensions, make it a priority to implement now. Stop reading and start launching. For advertisers who do have Ad Extensions, continue to monitor performance, look for changes starting on 10/22 and maybe keep an extra box of tissues nearby.

As with all Google changes, time will tell. If anybody has noticed significant changes yet, please share! 

Alyssa is a former LunaMetrician and contributor to our blog.

  • CrisisMaven

    The “everybody pays more” is probably the reason behind this move. Google so far had no other notable ranking factors for ads other than pre-determined payment and frequency parameters. These were static as long as their “owners” did not change them. Now Google has found a way to have advertisers on their toes even after setting certain parameters. The amazing thing about Google is how they constantly manage to marry technology with business strategy. In most other companies these departments never work so close together. Google’s balance sheet is living proof the strategy works.

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