How Quality Score Can Reduce Cost Per Click & Increase ROAS

At its most basic level, paid search advertising is a marketplace where billions of small auctions take place every day to determine which ads will show for a search term and in what order. Due to the nature of auction-based pricing in an open market where anyone with an account can bid, cost per click (CPC) may seem out of your control. However, there are tips and tricks that you can use to lower CPC up to 50%, and several of them relate to Quality Score.

What Is Quality Score?

Quality Score is a rating, on a scale of 1 to 10, which combines a search engine’s perception of how well your keywords and ads match searcher intent, the quality of the landing page your ads click through to, and your ads’ historical performance. A high Google Ads Quality Score indicates that your ads are well-matched to search terms, and that they and the website pages they link to provide a good user experience.

Google introduced Quality Score in 2005 as way to correct issues inherent in a straight auction model, where the highest bidder won, period, regardless of how relevant their keywords or ads were. The addition of a factor that captured relevance and, later, quality of user experience fundamentally changed paid search advertising. In the ensuing years, Bing and Yahoo added quality measurements to their paid search ad platforms as well.

What is the Difference Between Quality Score and Ad Rank?

The official name of the factor Google Ads uses to determine CPC for an individual auction is Ad Rank. Since Google Ads work on a bidding system, your ad’s performance in the auction determines where your ad ranks in the paid search results.  Google Ads Quality Score also has a direct relationship with Ad Rank, so if your Quality Score is excellent, you can expect this to have a positive impact on your Ad Rank.  Though this direct relationship exists between the two and the terms are often used interchangeably, having a great Quality Score does not guarantee that you will always rank at the top of paid search results. Your overall bids and bidding strategy also play a massive role in what your overall Ad Rank is. However, increasing your Quality Score is always a good idea if you want to pay less per click, as there is a direct effect of ad rank on cost, especially with larger budgets.

Quality Score Components

How is Google Ads Quality Score determined? Through a calculation involving three core components: Ad Relevance, Expected Click-through Rate, and Landing Page Experience.

Ad Relevance

Ad Relevance refers to the relevance of the ad and its corresponding keyword to the search query, as perceived by the search engine.

Expected Click-through Rate (CTR)

This is calculated using the expected and/or historical click-through rate of the:

• Keyword and ad
• Display URL – the URL shown in the ad, not the URL of the actual landing page
• Overall paid search account, especially in the geographic region of the searcher

Landing Page Experience

How well does the landing page experience match the searcher’s expectation, as perceived by the search engine

• The searcher’s device is a factor in landing page experience; serving non-mobile-optimized landing pages to mobile users will harm your Quality Score

When you introduce a new keyword in Google Ads, Google uses your account’s historical performance to determine the Quality Score of the new keyword. If your account is starting from scratch, or if the new keyword is a complete departure from everything else in your account, Google assigns it a base Quality Score of 6.

Why Does Quality Score Matter?

As mentioned previously, Google Quality Score affects ad position through Ad Rank. With both bids and Quality Scores contributing to ad position, it is important to maximize Quality Score to make your marketing dollars stretch as far as possible. In addition to Ad Rank, Quality Score can impact your CPC.

As Quality Score improves, Ad Rank is likely to improve and CPC becomes lower on average, ultimately leading to a higher return on ad spend (ROAS) and return on investment (ROI). Therefore, it is important to keep all the elements of Quality Score optimized as part of account and ad efficiency.

What Impact Does Quality Score Have on CPCs?

The relationship between Quality Score and CPC cannot be overstated. Data analysis done in 2013 estimated that the average Google Quality Score in all of Google AdWords (as Google Ads was known at the time) was 5. The analysis then determined that increasing discounts to CPC are applied as a keyword’s Quality Score goes above 5, and that CPC gets progressively higher the lower a keyword’s score goes below 5. The data in the table is taken from the 2013 analysis and should be considered more of an estimate than pinpoint math. Even so, the range of discounts and penalties provide a clear picture of how Quality Score affects CPC.

How to Improve Keyword Quality Score Over Time

Because it isn’t determined by only one component, you can improve multiple Quality Score factors at the same time to improve your score faster. Google Ads Quality Score optimization tactics fall into four basic categories:

Improve Ad Group Targeting

“Tightly themed ad groups” means that the keywords in the group are targeted around a specific theme, and ads have been created to focus on that theme as well. This increases the relevance of an ad in the group to a keyword in the group, which of course is a major component of Quality Score. Also, since performance on related keywords can affect the Quality Score of individual keywords in the group, having keywords organized into targeted themes can also help boost their score.

Improve Keywords

When conducting keyword research, seek out long-tail terms, which have lower search volume but higher specificity. These niche terms are easier to match with searcher intent than large-volume terms, and they’re very effective at targeting specific customer groups.

Use negative keywords strategically to weed out irrelevant traffic. Think of negative keywords as sculpting your keyword traffic: to paraphrase Michelangelo, they remove everything that isn’t desired. Eliminating irrelevant traffic increases the likelihood that visitors will have a positive experience on your landing pages, which will improve Quality Score. (It also reduces your cost per acquisition and increases the likelihood that searchers who click through will convert!)

Another way to improve Quality Score at the keyword level is to delete keywords with low scores, as they’re dragging your whole Google Ads account down. Use the low-score data to identify which keywords aren’t working and analyze the data to inform future keyword research.

Improve Ads

As with keywords, improving ad copy will benefit your paid search performance in many ways. Ad copy that matches searcher intent will not only increase Quality Score by improving relevance, it will also increase click-through rate, which is another component of Quality Score (and paid search performance as a whole).

Specificity is key to good ad copy. Ads that attempt to capture broad groups of searchers are too generic to attract searchers who are interested in what your company offers. A classic marketing axiom holds that “the worst target market in the world is everyone,” because such a broad audience is almost impossible to reach effectively.

Specificity also helps with keyword and searcher intent relevance. The keywords in an ad group can be completely optimized, but if the ad copy associated with those keywords is vague or bland, Quality Score will suffer and so will paid search performance.

Ad extensions are another way to affect your Quality Score, but they must be used intelligently. Using extensions doesn’t automatically improve your score; in fact, if the content in the extension(s) is irrelevant or leads to disappointing landing pages, your score could take a hit. So be sure to optimize any extensions you use as much as you optimize your ad copy.

Improve Landing Pages

Because the searcher’s experience doesn’t stop once they click on an ad, Quality Score includes landing page quality. A searcher who clicks on a well-written, tightly targeted ad only to be greeted by a generic landing page – or, worse, the homepage – will likely abandon their conversion journey then and there.

To deliver a good landing page experience, make sure your page aligns with the ads that lead there. Repeat the offer and messaging used in the ad, then use the landing page to detail the benefits of the offer and let the searcher convert. (To deliver the best possible landing page experience, engage with a CRO team.)

Check Page Speed and Technical Performance

Don’t forget the technical aspects of landing pages, which can significantly affect user experience and conversion. Landing pages must be mobile-friendly; conversion rates tend to be lower on mobile than on desktop, so maximize your odds of conversion by presenting mobile-optimized pages.

Additionally, page load speed has a dramatic impact on user engagement, so ensure your SEO team makes minimizing page load time a priority.

The Value of Quality Score Improvements: Case Study

A utility billing company had a rather good average Quality Score of 6.5, meaning they were getting an average CPC discount of more than 20%. However, we don’t believe in settling for “good enough,” so we made improvements to ad groups, keywords, ads, and landing pages over the next 6 years. As a result, the company’s average Quality Score increased 37% to 8.9.

Over those 6 years, the CPC discounts for Quality Score increased and compounded until the company had saved an estimated total of $1.5 million just on CPC. This amount is over and above what they would have saved had their average Quality Score remained at 6.5.

During that same time period, ROAS increased by 55% even as conversion volume scaled up by more than 14 times. Quality Score improvements didn’t cause all the increase, but they definitely contributed. In the final year of the engagement, the company saved an estimated $632K from Quality-Score-generated CPC discounts. ROAS at the time was 465%, so the company could re-invest those savings into ad spend to yield a return of up to $2.9 million.

How Our Team Can Help You Drastically Increase ROAS

Looking to get more performance out of your marketing dollars?  Here at (un)Common Logic, our team has decades of experience in paid search marketing and have been able to get clients extraordinary results. Our expert team can evaluate where inefficiencies lie in your Google Ads account and make optimizations that can drastically increase performance at lower spend levels.

If you’d like to learn more about how one metric within Google Ads can have such a profound impact on CPC and thus ROAS, or if you’d like to talk about which steps to take to improve your ads’ Quality Score, get in touch with us.

Want to know more? Learn about the importance of analytics and our uncommon approach to successful marketing plans in 2023.