AdWords Average Position: Your Jungle Survival Guide To Exposing Ranking Myths

Average position can be a tricky thing to manage. There are those agencies out there that will promise “to get you to #1 in Google” and others who will bash on your account during an audit, because your competitors are outranking you. If these sound like scripts from the playbook of an agency you’re considering or even currently working with, I’m not going to tell you to fire them (yet)–but I will tell you to give us a call.
 

 
Throughout my PPC career, I’ve heard from too many clients and even so-called “PPC professionals” (*gasp*) talk about how important it is to be #1 in ad rank. While it frustrates me to see so many potentially great accounts underperform, because they’re misreading the clear signs that their metrics are giving them, I do get where these pro-#1 pundits are coming from.
 
We’ve all been raised to think that 2nd is the 1st loser. However, I’m here to lay that notion to rest right here and now when it comes to PPC. It’s time to put 2nd (and even 3rd sometimes) on the PPC pedestal on which it belongs. I know it may be hard to initially grasp that concept, but I’m confident that we’ll get there together before the end of this post. After all, if Lebron can learn to consistently be OK with 2nd place, I know we can.
 
 

7 Common Myths About Average Position

As mentioned in the opening paragraph of this post, average position is often a very misunderstood metric. Some claim that it’s one of the most important PPC metrics that you should be tracking. Although I wouldn’t go as far as to say that it should be your golden egg, I do agree that it’s an important means to the end.
 
After all, average position can determine how much and what kind of traffic you’ll receive, which ultimately will determine whether or not this PPC thing is making you money and working for you. Undoubtedly, we should be analyzing and tracking our average position, but the trick lies in how we analyze it and what we do with the data that we find.
 
I can’t stress how important it is to choose the advice you take wisely. So, who better to take advice from than our tour guide for the remainder of this post, the one and only L-Train (contrary to popular belief, the L does not stand for Loser)?
 

 
Now, let’s go ahead and break down some of the most common misconceptions about average position:
 

The Higher the Position, the Better

 
Perhaps the most common and most frustrating myth of them all is the belief that the higher your average position, the better your account is performing. We’ll discuss later on many reasons why not only is this completely missing the point when it comes to choosing proper KPIs, but also why the average position metric provided by AdWords is a distracting lie.
 
To prove this, we extracted some data from one of our own client accounts. As you can see in the below screenshot, both the CPA and conversion rate improved quite considerably when the average position dropped.
 

 
The CPA drop is easier to grasp as one could assume that if the average position dropped then it could have been a result of lowered CPCs–and assuming that if the conversion rate would remain consistent, CPA would be bound to drop. However, how can we explain the INCREASE in conversion rate? We’ll discuss this a bit later, once we get to analyzing and optimizing average position (don’t you love cliffhangers).
 

2) If I Bid Higher, I’ll Surely Improve My Position

If there’s one trend that we’re quickly learning from this post, it’s that higher is not always better. This same trend applies to your max CPC bid as a higher bid will not assure you a better position.
 

 
Even though it may seem from time to time that Google is the big, bad, greedy money sucker that only cares about their profits, they do actually have a quality product to maintain. In fact, they even contract over 10,000 search quality raters to check their quality.
 
It wouldn’t make sense for Google to simply allow the advertiser with the deepest pockets to own their search results. Due to this, Google does stress a high importance on the actual quality of the ads that the advertisers are throwing out into the world and, therefore, the quality score plays an important role in ad rank.
 

3) Google Controls the World and We’re Helpless, so Who Cares

Ok, this one is kind of true. But only kind of.
 
In the years that I have been in the digital marketing world, perhaps the one most important thing that I’ve learned is that they’re always watching us. The amount of information that Google knows about us can be quite terrifying; however, instead of running away, I’ve learned to embrace it. The reason that Google wants to know so much about us is because they truly want to provide us with the best product possible for us — a product so high in quality and accuracy that it was as if it was customized exactly for each and every one of us.
 
So, instead of raising up our arms in defeat, what us marketers can do is help Google by doing our part and making our advertising campaigns the very best they can be. In return, we may find that our average positions will get a boost without the extra buck.
 

4) It’s Too Expensive to Compete in Those Top Positions with the Big Boys

This myth is a bit of a culmination of the other myths we just discussed. If you’re a small ma & pa shop competing against Fortune 500s then, yes, it may be a bit challenging to compete; however, I wouldn’t give up. If you choose the right keywords to compete against and devise a sound structure in your account, you could be the underdog feel-good story of the season.
 
Remember, QUALITY MATTERS.
 

5) If You’re Not in the Top 3, You Don’t Exist

You know the best place to hide a dead body? On page 2 of Google search results (I would have also accepted “Bing” as a correct answer – JK, we love Bing).
 
While being on page 2 of the search results most likely will dramatically decrease your reach, you can still survive and even thrive while still not being in the top 3 search results.
 
With that said, there are some pretty cool benefits to being in the top positions. For one, you appear before the organic listings and above the page fold, meaning you’ll definitely have many more eyes on your ad. Two, the likelihood of your ad extensions appearing with your ad are greatly increased. And three, your ad can appear longer and probably won’t be as truncated.
 
All those benefits definitely sound very attractive–but once again, it’s all about KPIs. In the screenshot below, you can actually see that when our average position dropped below the top 4 positions, CPA actually decreased and conversion rate increased.
 

6) My Competitors Are Ranked Higher Than Me; We Need Their Magic

If all your competitors jumped off a bridge, would you jump also?
 
Although it’s very important to understand your competitive landscape, unless you have direct access to their AdWords accounts or somehow have a mole planted on their side, you won’t really know if what they’re doing is successful or not. It’s much more important to have a firm grip on your own KPI goals and to know what your plan of attack is to achieve them.
 
With that said, Google does provide us with auction insights that allow us to compare performance against our top competitors for a particular keyword or traffic source. Using this will allow you to see how you’re competing and make strategic decisions about where there may be additional opportunities. Additionally, if you notice a recent spike in CPCs or a dip in your positions, checking the auction insights would be a good first place to check.
 

7) Let’s Just Throw the Keyword All Over the Landing Page

In the old days of digital marketing, “savvy advertisers” would hide text all over the landing page in an attempt to trick the search engine into thinking their landing page was the most relevant of them all.
 

 
While this may have worked for some time, you can only fool the geeks at Google for so long before they catch on to you. I’m sorry to inform all you shortcut seekers out there, but today this tactic is obsolete.
 
It’s now more important than ever to actually take the time and effort to create a quality landing page that will convert. Google cares about quality and rewards us for helping them out with this. Therefore, proper message matching of your landing pages goes far beyond simply throwing your keyword all over the page.
 

What is Average Position?

So, now that we’ve thoroughly gone through many of the misconceptions about average position, we can start talking about what we can do to own it. However, before we get into the nitty gritty about how to manage your average position, it’s important that we first have a firm understanding of exactly what it is.
 
Average position can have a slightly different meaning or behave a bit differently depending on what platform you’re using. For example, one glaringly noticeable difference between Bing and Google ad positioning is the difference in their respective SERPs (Search Engine Results Page). As of early 2016, Google removed the side ads from their interface and began only serving ads above and below the organic results.
 
In addition to this, they also made the ads appear more native. For the purpose of this blog post, we’ll be focusing primarily on average position as it pertains to Google, but this doesn’t mean that I’m not a big fan of Bing.
 
According to Google, average position is a statistic that describes how your ad typically ranks against other ads. This rank determines in which order ads appear on the page. Since Google updated their SERP, positions 1-8 generally appear on the first page while 9-16 on the second. Since ad rank can fluctuate based on several parameters, average position can also fluctuate and therefore, the average position that appears in your metrics on your AdWords dashboard can be between two whole numbers (i.e. 1.4).
 

How Is It Determined?

As mentioned above, the ad rank that determines your average position can fluctuate based on a couple of factors: quality score and max bid. By keeping the focus on your main fundamental KPIs, it’s possible to blend these two factors into the average position that will carry you to a championship season. While you may adjust and optimize quite a bit until you find that special spot, eventually, you’ll get there.
 

Max Bid

Using a cost-per-click (CPC) bidding strategy, the max bid is the maximum CPC that you’re willing to pay for a click on your ad. While Google does provide advertisers with several automated bidding strategy options, if your goals are well defined and you know your way around an AdWords account, manual CPC will allow you more control over your performance.
 
Of the two factors that determine your ad rank, this is the one that is much more controllable and easily adjusted.
 

 
Even though adjusting the bid may be very rudimentary, choosing the appropriate bid takes a bit more expertise and know-how. In fact, we wrote an entire blog post about choosing bids. While some may go as far as to formulate a precise calculation for the appropriate bid, us “simple folk” may prefer the nitty gritty approach. To break it down simply, choosing the right bid is reliant on three fundamental aspects — your campaign type, the cost of your keywords, and the success of your keywords.
 

Campaign Type

To start, we have either the Google Display Network (GDN) or the Search Network. Since bidding and average position work a bit differently in GDN, let’s stick with the Search Network for now. Yet still, within the Search Network, different types of search campaigns with different objectives will require different bids. Whereas a branded campaign may not need to have a very high bid to own the top positions, a top-of-the-funnel prospecting campaign may require a higher bid to be competitive.
 

Cost of Keywords

Since different types of campaigns behave differently, the cost of the keyword will also behave differently. The ultimate determining factor of the starting bid you’ll need for your keyword is the competitiveness of that keyword.
 

 
Out of the kindness of their hearts (and our wallets), Google went ahead and provided us with several tools we can use to find that correct bid.
 
First, there’s the friendly reminder that we’re not gonna make it to the first page:
 
 

 
Then, there’s the always trusted bid simulator (**sarcasm continues**):
 
 

 
And lastly, there’s my favorite of them all, the Google AdWords Keyword Planner Tool (ok, this one actually is my favorite, no sarcasm):
 
 

Success of Keywords

Of all the factors that play a role in your max CPC bid, this is the one that you should care about the most. Once again, we revert back to those KPI goals that we discussed earlier in this post. These goals should ultimately be what you’re using when determining the best bids for your keywords.
 
Unfortunately, in order to do this properly, it’s necessary to first have some data history on that keyword, which will help point you in the right direction. If it’s a new keyword that you pulled from a search term within your account, you should be able to have a head start on choosing the right bid by analyzing how it was performing as a search term.
 

Quality Score

The second part of determining average position is quality score. Although this isn’t AS easy and immediate to adjust as the max CPC bid, it’s nothing to fear. By mastering this aspect, you’ll be able to improve your avg. position without ever having to reach into your pockets and increase your max CPC bid.
 
Quality score can also be broken down into three key factors: landing page experience, expected CTR, and ad relevance.
 

Landing Page Experience

The landing page experience is a measurement of how relevant your landing page is once a visitor clicks on your ad. For this reason, it’s important to make sure your landing pages are clear and useful to the visitor. The three statuses given by Google to grade your landing page is either below average, average, or above average. Clearly, we’d like to push for the latter of those three.
 

Expected CTR

This is a tricky one. On the one hand, ya, we all love seeing a high CTR to give us affirmation that people like the ad copy that we’re throwing at them. On the other hand, do we really want the higher CTR at the sacrifice of wasted clicks?
 
Believe it or not, there have actually been times in my career that I’ve intentionally tried to lower CTR. I know, that sounds absurd, but stay with me here.
 
What if I were a loan lending company and I had a killer CTR, but all my visitors weren’t qualified? Every other click I received was from someone that didn’t have the credit score that I need, but I don’t want to remove the keyword I’m targeting as it also does bring quality traffic from time to time. One solution to this dilemma is stating some of the qualifications you need in the ad copy in order to filter out the bad traffic. This would undoubtedly lower CTR, but it doesn’t sound so crazy anymore, does it?
 
Basically, the right formula for CTR is to aim for high, but also be clear in your ad copy to make sure you attract the right traffic.
 

Ad Relevance

Well, since the expected CTR section above did such a fine job explaining the importance of this, I’ll just leave you with some more tips for mastering ad copy.
 

Analyzing Your Average Position

Ok, so now we know about the myths associated with average position and we’re educated on how it works. So, what next? Well, of course, now it’s the part you have all been waiting for…ANALYZING YOUR AVERAGE POSITION (if you skipped straight to this section, I demand you go back to the top and read from the beginning).
 
Up until now, we really haven’t discussed how complex average position can be. Average position was a metric we were provided within the AdWords interface that shows us where we fall in line on the Google SERP, or so it seemed. Well, I’m sorry to be the bearer of bad news, but it’s not that simple. It never is.
 
There are many different ways, shapes, and forms to look at average position, but since I have a deadline to get this post out, we’ll only discuss several of them. However, I do encourage you all to take this intro as an opening to a new door of analysis and run like the wind with it.
 

Position by Location

Perhaps your account is performing better in Cleveland, OH than it is in Oakland, CA (not likely, but let’s just say it is). If that’s the case, you may want to increase the bid adjustment in that location resulting in a higher average position for Cleveland.
 

Position by Schedule

The time of the day and day of the week also matter when it comes to analyzing the differences in performance within the account. Looking at these differences and optimizing appropriately will allow you to stay ahead of the game.
 

Position by Device

Analyzing the average position by device is a bit trickier. If you call Google support for assistance on this one, they’ll probably advise you to utilize different attribution models to show the “true” effectiveness of the mobile performance before you pull any budget away from it (I challenge you to test this hypothesis by reaching out to them and letting me know the results in the comments section of this post).
 
Now I’m not saying that there isn’t any truth to what our friends at Google are saying, however, please do proceed with caution when it comes to optimizing for mobile.
 

Position by Audience

Optimizing your position by audience is one of my favorite quick wins when analyzing an AdWords account and, sadly, it’s often one of the most forgotten.
 
Whereas the other three strategies mentioned above can all be found under your campaign settings, this one is a bit more hidden under the Audiences tab. Additionally, in order to perform this handy hack, you’ll need to first set up your RLSA audiences–but trust me on this one, the work will be well worth it.
 
Not many things can make me happier than finding an audience that is currently in avg. position of 4 but performing 100% better than the overall campaign performance. UP ‘DEM BIDS! I know, I’m easily pleased.
 

What Position Do You Want?

We know that everything we’ve learned about average position before reading this post was baloney. We get how it works. We opened our eyes to analyzing it on a more granular scale. Now we’re for sure good to go. Thanks Joel!
 
Wait, what position do I want?
 
I’m glad you asked. That’s our next section.
 
Clearly, we understood that our average position should be based on the performance and not placed on some arbitrary ranking system. That’s always the case. Well, not really. There are some exceptions to that rule.
 

Branded

The cherished branded campaign. A branded campaign can often cause quite a bit of controversy. After all, if our organic search results already own our branded terms, why even bid on those keywords? As I am firmly on the pro-branded side, I’ll say that there are many legitimate reasons to bid on branded, but that’s a whole other blog post in itself (*note to self: write blog post on branded campaigns).
 

 
Whereas the general rule states that we should set our ideal average position based on performance, I’ll make an exception for branded terms. Branded terms should always shoot for numero uno. The main reason being, you never want to lose this traffic to competitors trying to steal your lowest of hanging fruits. In addition to defending yourself against competitors and being extremely low hanging fruit, branded terms also work well to boost your organic results and allow for much more efficient message testing.
 
If branded is too expensive for you to compete, that’s a different issue. As this is your brand name and you should own the domain associated with it, Google will give you a high quality score, which will result in cheaper CPCs. If this isn’t the case for you, you may want to start by looking at your branded search terms. Or, better yet, reach out to us and we’d be happy to help.
 

Display

Analyzing and bidding for display positions is not as intuitive as it is for search. In the Google Display Network, we’re actually bidding on “slots” on publisher sites. Whereas in the Search Network it’s quite clear and easy to understand where your ads are being served based on the avg. position metric provided within your AdWords interface, the GDN (Google Display Network) does not provide you with an average position.
 
Instead, the GDN takes your bid to auction and, depending on how competitive your specific targeting strategy is in your particular campaign, your ads will be placed onto various locations of publisher’s websites. You can think of the websites that you get served on and the locations on those websites as your sort of “Display Network position”.
 
Just as we optimize based on the performance of our KPIs in the Search Network, we also do in the Display Network. This can vary depending on the type of display campaign that you’re running; however, as a general rule, we want to find the placements that are hitting our goals the best and turn them from automated placements to managed placements by placing more aggressive bids on them to up the traffic and earn the more valuable locations on them.
 

 
One additional point to keep in mind, however, is that your best performing placements may still not even be being served to yet if your initial bids are too low, so make sure to keep that in mind when you’re experimenting with GDN bid adjustments.
 

Bid on Performance

Only one word needed for this one — KPIs.
 
To bring us back to the prevailing point of this entire blog post, bidding on performance is all about KPIs and for the vast majority of your campaigns, this is the way to go. Whether that pinnacle of performance is reached at the 2nd position or at the 5th position, we always like to revert to the data to help make our decisions easy for us.
 

Best Practices to Manage Average Position

If you thought we were done here, well then sit back down. After all, if this is supposed to be the true “survival guide for getting through a jungle of average position myths”, it needs to be thorough. So, thorough it shall be.
 
We’re almost there–but before we part ways, since you’ve been such a great audience, we want to leave you with some of our very own KB best practice secrets to managing average position.
 

Top vs. Other

While it definitely is more convenient to simply trust the average position reported in your AdWords metrics, the top vs. other segment will paint a picture that should help you get to your ideal position faster.
 
Found under the the Segments tab, this hidden metric compares how your ads perform when shown in the top positions versus other placements.
 

 
As you can glaringly see in the screenshot above, when our client was in the top positions, CPA and conversion rates dramatically improved. Although this isn’t always the case, in this particular situation, we’d want to increase bids to improve our ad rank.
 

Bid Strategies

Worried about robots taking your job?
 
While this may become a reality that we need to prepare for, in the meantime, while we still have our jobs, let’s use these robots to make our jobs a bit easier.
 
Automated bidding allows us to take some of the guesswork out of bid management. Of course, there are some restrictions and best practices that are advised to use when utilizing automated bidding. However, as a general rule, it should be aligned with your own KPIs (ROAS, CPA, etc.).
 
For the sake of relevance to this post, the target search page location bidding strategy can be used once you decided what location has proven most effective for your performance. This portfolio bid strategy can be used across multiple campaigns, ad groups, and keywords to target the top of the page or on the first page of Google search results. After using the top vs. other segment to find where your performance is kicking bootay, using this bidding strategy can help you get to where you want to be.
 

SKAGs (Single Keyword Ad Groups)

Oh SKAGs, how we love thee.
 
SKAGs and KlientBoost go together like Lebron James and NBA Championship trophies. Wait, let’s try that again….
 
SKAGs and KlientBoost go together like Michael Jordan and NBA Championship trophies.
 

 
One of the fundamental reasons SKAGs help us to get great results for our clients is their ability granulate an account to the point where you have complete control over your performance. By understanding the Iceberg Effect, we know that what we see above the surface can be much different from what lies beneath. With SKAGs, we remove the search terms from “beneath” and target them as their own keywords, therefore enabling our ability to give them the appropriate bids for the appropriate positions with less surprises.
 

Final Thoughts on Average Position

There was a pretty big election not too long ago that I’m sure not all of you were thrilled with the results. The first place victor was not everyone’s first choice. Even Lebron would agree with that. However, for many, neither was the second place finisher. But what if we lived in a world that it didn’t matter what “place” someone finished in, but rather we went with the position that was best for us. Wouldn’t that be a grand world?
 
Now, I challenge you all to manage your average position with that thought in mind. Forget the desire to always be in first or wanting to outrank your competitors. Let go of the days of blind bidding by simply analyzing one vanity metric. A new era is upon us. Make wave for the new champion in ad position optimization. It’s time to dive deeper into our accounts and take control of what’s really going to drive us results.
 
I hope that with these tools and processes to managing your average position, you’ll be able to get first place in your boss’ heart by making them more money.
 
Whether you work at another PPC agency and will use this to explain to your clients why average position is a farce or are managing your own account, I’d love to hear your thoughts and experiences with managing your average positions. Please share below and maybe you’ll make it to first place in the comments.

The post AdWords Average Position:</br> Your Jungle Survival Guide To Exposing Ranking Myths appeared first on KlientBoost.

This content was originally published here.