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Old 06-17-2005   #1
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Question Adwords Algorithmic Changes

Sometime in mid to late April (from the 18th - 26th), it appears that Google made some changes to the Adwords algorithms. After doing some searching, it appears that Google now utilizes the CTR for an ad copy group as opposed to leveraging the CTR for a specific keyword.

For example, in the case of eBay, they may now have to increase their bid on the keyword 'automobile' to receive the same placement because Google Adwords is using their CTR on the entire ad copy. And since eBay (or its affiliate network) bids on a large number of words that may not be relevant, the overall CTR may be lower for those irrelevant terms (ie. sand dunes), bring down the ad copy CTR.

What are the consequences of this change? It seems to me that the coverage on Google's Keywords will decline, as eBay and or its affiliates may stop bidding on not-so-relevant keywords. Additionally, it seems the average click-thru rate would increase due to a higher mix of relevant ads. Also, due to a reduction in bidding at the $0.05 price point on not-so-relevant, it seems the average CPC may increase as well.

Any thoughts on the subject? What have you guys heard on your end? Some advertisers have pointed to CPC increases of 20% + as a result of this change? Are you guys seeing this too? What does this mean for the volume of click-thru's?
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Old 06-17-2005   #2
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Hey Player (don't worry I'm not hating the player...I'm hating the game )

Great thread. I was wondering what seemed to be happening with some of our Positions...and this explains a lot if accurate. Did you find any of this within the guidelines at G? I would love to get some feedback on this from AdWords Rep...so I will ask him to comment if I can get his attention.

Another point to consider in this...what if you have multiple Ads running in the same group, and are getting various CTR's for each of them? naturally Google tends to use the higher CTR ads, but would keeping the low ones in your group without deleteing them perhaps affect you too? Especially if you are getting 100's of impressions even at 3-5% showing?

I will do some more research on some of our accounts and get back to this thread soon...
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Old 06-21-2005   #3
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I have noticed this and the funny thing is had no mention of it from my rep... who also was wondering why a few of my terms were getting dropped etc.
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Old 06-21-2005   #4
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Question

Somewhat irrelevant to the topic but, does ebay have a special "deal" with google for bidding on every word in the dictionary and encyclopedia (as it seems)?

And I assume they use some kind of robots to collect these keywords?

Just curious
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Old 06-21-2005   #5
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Originally Posted by doc816
Somewhat irrelevant to the topic but, does ebay have a special "deal" with google for bidding on every word in the dictionary and encyclopedia (as it seems)?

And I assume they use some kind of robots to collect these keywords?

Just curious
No they just do a mass upload... hence the ads for selling used children etc....
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Old 06-21-2005   #6
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My understanding is that eBay does not engage in that type of marketing itself. But instead, affiliate partners of eBay, who get paid for driving traffic to eBay.com, are the primary advertisers on those types of terms.

That being said, I do know that eBay has one of the more sophisticated online advertising programs and wouldn't doubt if they were mass uploading over 100K keywords per month.
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Old 06-21-2005   #7
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What happens when your keywords get disabled due to poor performance in terms of CTR, is there a way to bring them back to active state?
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Old 06-21-2005   #8
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Quote:
Originally Posted by doc816
What happens when your keywords get disabled due to poor performance in terms of CTR, is there a way to bring them back to active state?
You can play with it by changing the match type such as try phrase match and delete the old broad match.
But the best way is to start another campaign... first delete the old one which flushes the old numbers and then create a new campaign and put the term in ... you should look to add a bunch of negatives as it is usually the basket of adjectives that add to the lowered CTR and eventually get the word disabled. This basket is invisible but what is happening is Google tracks the poor CTR for say crazy widgets when you advertise widgets and really have nothing to attract people searching for certain specifics.
So a good pile of negatives will help.
You also want to increase your Max bid... it will help also.
For a real term try something like foreign exchange while you may be thinking foreign exchange rates others could be trying for foreign exchange students or even foreign language exchange... if you get to know your terms it is sometimes better to create a large list of exact match or phrase match terms than use the shortened version and make it broad.
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Old 06-22-2005   #9
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FYI, this came up over at WebmasterWorld in April, and AdWordsAdvisor dropped a few comments into a thread on it: http://www.webmasterworld.com/forum81/5145.htm. Same issue -- advertisers weren't told of the change. Barry blogged that thread, as did I in May -- but clearly the word didn't get around. All the more reason for Google perhaps to clarify it.
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Old 06-22-2005   #10
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Thumbs up

Quote:
Originally Posted by AussieWebmaster
You can play with it by changing the match type such as try phrase match and delete the old broad match.
But the best way is to start another campaign... first delete the old one which flushes the old numbers and then create a new campaign and put the term in ... you should look to add a bunch of negatives as it is usually the basket of adjectives that add to the lowered CTR and eventually get the word disabled. This basket is invisible but what is happening is Google tracks the poor CTR for say crazy widgets when you advertise widgets and really have nothing to attract people searching for certain specifics.
So a good pile of negatives will help.
You also want to increase your Max bid... it will help also.
For a real term try something like foreign exchange while you may be thinking foreign exchange rates others could be trying for foreign exchange students or even foreign language exchange... if you get to know your terms it is sometimes better to create a large list of exact match or phrase match terms than use the shortened version and make it broad.
Thanks for the tips Aussie You've been very helpful.
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Old 06-27-2005   #11
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I had a lengthly discussion at a recent search conference with a Google engineer who really cleared up a lot of this ad CTR mystery.

The basic algo is CPC x CTR.

There are around 100 factors that might come into play depending on user location, advertiser targeting options, keyword matching options, user search intent (based on keyword ideations), etc, etc.

So, when Google says it depends, they really mean, it depends.

The adwords algo is now exceedingly complicated, and I don't think most of the adwords engineers understand more than CPC x CTR x possible factors = position & price.
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