Announced today, by the Inside AdWords crew:
Today, we began rolling out improvements to the Quality Score algorithm, which will update the Quality Score for keywords in your account over the next 3 to 4 days.
The goal is to improve the quality of the ads, which is great and I applaud their efforts to try and combat arbitrage and low quality ads, unfortunately, I’ve uncovered another side to the story of the AdWords system which isn’t so great.
The main factors in calculating quality score are click through rate, the relevance of the ad and landing page, but there are many other minor factors at play, which are not disclosed. After talking to my rep the other day, one issue which I’m not happy about at all, is the fact that a quality score is applied to the keyword, but not per account, but just the keyword itself. All advertisers are then subject to this generic keyword level quality score.
What this means is that if you have a great campaign with high click through rates, perfectly relevant ads and are seen as an authority of a topic, your minimum bid may increase because the keyword quality score overall was dragged down by arbitrage, junk sites and other accounts which, perhaps through inexperience, are bidding on the wrong keywords.
Let me reword that slightly different – your minimum bids may be raised based on the actions of other accounts, which are totally beyond your control.
This is absolutely horrendous!
The end result is that good performing accounts are effectively penalized and in one of my cases, the minimum bid was raised to a level, where there are NO advertisers willing to bid for that term, and it wasn’t one of those $1, $5 or $10 minimum bid raises either.
It seems Google has shot themselves in the foot on this issue and I know there are going to a lot of similar complaints with this new quality score system.
It doesn’t matter how much Google stresses the quality aspect of this update, advertisers are only going to see the issue that affects them the most, how much it’s going to raise their prices.