Combatting rising CPCs in Google AdWords

There are no two ways about it, Google is the number one global Search engine, used by billions of users to find information. Every day more advertisers are utilising paid Search to ensure their business appears on page one of Google.

Generally speaking the more people in the auction the more you’ll pay per click. There’s not much you can do about new entrants to the market other than to keep focussed on your goals and keep one step ahead of the curve.

Rising CPCs in Google AdWords

 

Over time many businesses have seen a steady increase in their CPCs. Aside from increasing bids, there are other ways to help ensure that your ad gets the coveted top spots and your competitors don’t.

First, let’s look at things that affect your CPCs and why?

Quality Score

Quality Score is Google’s 1-10 rating of the quality and relevance of your keywords, ads, ad extensions and landing pages. It is used to determine your cost per click and multiplied by your maximum bid to determine your ad rank in the ad auction process. The higher your score the less you’ll pay and the higher your ads rank in Google. Here’s an example.

Max Bid X Quality Score (1-10) = Ad Rank Position in Google
Advertiser 1 £2.00 X 10 = 20 1
Advertiser 2 £6.00 X 2 = 12 2

 

The thing to note about the formula is that by having a higher Quality Score, it’s possible to outrank a competitor who has a higher bid.

Advertiser 1 outranks advertiser 2 even though she has the lower bid because of her top quality score of 10. Seller 2 tries to outbid her but this strategy does not work as he has neglected his quality score.

How to improve quality score

1.Ad relevancy

Following on from the above, Google rewards you with better Quality Scores for ads and ad extensions that are relevant to a user’s search query.

Ad relevancy is vital for a number of reasons. Firstly it provides vital information about your business to the user, second, it manages the user’s expectations about what you can offer them before they click and third it makes you stand out from the competition.

As Google wants to deliver a good user experience to its users, ensure that your ad not only sells your business but is as relevant as possible to the keywords you are bidding on – ensure the keyword appears in the text and if relevant in your ad extensions too.

2.Landing page quality

Google also rewards you with better Quality Score for landing pages that deliver a good and relevant user experience.

Once a user has clicked your ad they will arrive on your website and the landing page needs to be as relevant as possible with paragraphs of text that describe your products.

If the user is searching for ladies black boots, they need to land on a page solely dedicated to ladies black boots, not, for example, a generic shoe shopping page with sandals, wedges, boots and flip flops.

3.Isolate low-Quality Score keywords

When you have keywords in an ad group that have consistently low-quality scores no matter what you do they limit the ad group and campaign. A solution is to put them in their own ad group with highly relevant ad texts and focussed landing pages. Or alternatively, if they are not of high value to your business pause or delete them.

Other ways to reduce CPC

Keyword opportunities

It is tempting to use short keywords on broad match to keep your account setup and management simple but often short tail keywords can be highly competitive, and they can waste budget on irrelevant terms by triggering searches that you don’t want your ads to show for. Try adding in some longer tail keywords that are searched for less often, but that could be cheaper.

Auction insights

As a last resort, if you’re not seeing any reductions in CPC or increases in CTR for the same CPC, you can run this report. It shows you the URLs of competitors who are bidding on the same keywords as you, how they rank and how often they rank above you.

Use this report and carry out some research into their ad text and landing pages. The objective is to make sure your ad text and landing pages deliver a better user experience than theirs. You’ll stand a much better chance of paying lower CPCs than them.

Final note

Sadly it is unlikely than CPCs will decrease in the long term – unless there are major shifts in demand in your market – so invest what you can in continually refining your campaign and website user journey to maximise your success and keep one step ahead.

You can learn more about quality score on this Google Best Practices resource.