July 15, 2011
As we reported yesterday, Google announced on Wednesday that you can now choose “Top vs. Side” as a reporting segmentation option within AdWords. Sure, that seems like interesting info, but why should I care? Not like I can tell Google to only show my ads in the TOP position 1, not the SIDE position 1. If I can’t do anything what does it matter!
The answer, my friend might be blowing in the wind, but it’s also within Hal Varian’s head and has been for quite a while. Let’s review. Way back in April, the Inside Adwords blog posted a note from Hal, which said: “there are two interpretations of the phrase “ad position.” The “page position” refers to the location on the page, such as “top ad 2” or “right-hand side ad 1.” The “auction position” is the rank of the ad in the auction that determines the order of the ads on the page. The critical point is that the reported average position metric is based on auction position, not page position.”
What that means? It means that a lot of the nonsensical things that you’ve seen happen when you fight to raise your average position with bid changes aren’t so nonsensical after all.
For example, if you move from position 1 on the Side to position 1 on the Top via a bid change, your reported average position in the past would not have changed. You would have been very confused as to why your performance changed when average position remained constant.
Additionally, because bid increases can make you eligible to win an appearance in more auctions, some bid changes can actually make your average position decrease. Again, if your performance changed either for the better or worse for a keyword, you had no idea why that had happened.
So how can you apply top vs. side segmentation to bring order to your little ad-position world and solve these mysteries? Let’s see.
Average position for this keyword is 3.2, all right. Maybe in the past, I’d want to bid up on this keyword if my cost/conv was okay. But: look! I don’t need to bid up to appear in 1.9 for the Top results. And will bidding up increase my position from 5.3 on the Side, or just qualify me to appear for additional queries and leave my position that low? Depending on my performance for each, I can decide if bidding up on this keyword is really something of value, or will harm rather than help me. Conversely, if I have a very high Top position, I may be able to bid down on this keyword without substantial impact on leads if my cost per conversion is a bit too high.
After you make bid changes, you can compare average position, CPC, and other metrics for two date ranges (one pre and one post bid changes) to determine the actual impact of your changes. Especially for broad match keywords, an increase in impressions after a bid change that comes from Side-shown ads may mean you are opening yourself up to traffic from additional queries; in this case it may be important to use a search query report to analyze the relevance of the traffic being driven by that keyword post-bid-change to ensure that it remains high and that the impression increase is actually useful to you.
Maybe in the future there will be segmented targeting or bidding options available based on this difference, and that’d be handy. But for the time being, it’s useful to use this segmentation to make bidding decisions and analyze comparative performance before and after changes.