Recently, I ran into an interesting change in my account. Interesting seems like a strange word to describe a change in performance, but, in this case, interesting was an accurate word.

## The “Interesting” Change

For months, conversion rate had been steady at 8% with some natural variance that is always present in paid search. Then all of sudden conversion rate dropped by 3 percentage points.

You would think a drop of conversion rate by 3% would cause horrific shifts in cost-per-conversion or at least a decrease in spend. However, this was not the case as spend and conversion volume remained steady, even with the decrease in conversion rate. What happened?

If this sounds like the setup to a riddle, it kind of is. When there are no new campaigns, constant bid changes and the same website landing pages, where does one look first when conversion rate changes?

Going back to the basic formula for conversion rate (conversions/clicks), we know that something must have changed with the clicks if conversion volume has remained constant.

Cost-per-click, which had been averaging close to a \$1.50 over the last 5 months, had suddenly dropped a dollar to average around \$0.50 for the next 2 weeks.

## The Solution To The Riddle

As a result, there are several items that can impact my cost-per-click:

• Change in competitors
• Change in quality score
• Change in bids

When calculating cost-per-click, you pay \$.01 cent more than your competitor with the closest ad rank. If a competitor has stopped advertising and no longer competing for the same advertising space, cost-per-click will decrease. This can be viewed in the auction insights tab of Google AdWords and looking at competitive metrics, such as impression share and impression share lost to rank. However, this was not the case in my situation.

Quality score is determined by expected click-thru-rate, landing page relevance and ad relevance. There is no way to view historical quality score in the AdWords interface. While one could potentially look through old keyword reports and use VLOOKUP to determine any shifts in the quality score before the cost-per-click decrease, there is a simpler way to judge if it has changed. Ask the following questions:

• Has the website undergone any updates?
• Have there been any noticeable changes to click-thru-rate?