1. What is the Google Ads auction?
   • How the auction works
2. What affects ad ranking?
   • Bid (Max CPC)
   • Quality Score
   • Keyword relevance
   • Expected impact of the extensions
3. How to improve quality indicators and reduce costs?
   • Increase CTR
   • Landing page optimization
   • Working with keywords
   • Bid optimization
4. What criteria determine ad position?
5. Conclusion

Google Ads uses an auction system to determine which ads will be shown, in what order, and at what price. This process is complex and depends on several key factors. In this article, we’ll look at how the auction works, what affects your cost per click, and how you can improve your performance to get the most out of your ad spend.

1. What is the Google Ads auction?

When a user enters a search query into Google, the system determines which ads are likely to match that query. But because the number of ad slots available is limited, Google holds an auction between advertisers.

How the auction works

1. Launching an auction
   An auction is launched every time a user enters a query into Google.
2. Selecting relevant ads
   The system analyzes all advertising campaigns that match the keywords and selects those that meet the quality requirements.
3. Ad Ranking
   Each ad receives an Ad Rank , which determines its position on the page.

2. What affects ad ranking?

Ad Rank is formed based on several key factors:

Bid (Max CPC)

This is the maximum amount an advertiser is willing to pay for a click. But that doesn’t mean you always pay that amount. Thanks to the auction system, you often pay just a little more than your closest competitor.

📝 Example : If your competitor is willing to pay $1 and you are willing to pay $1.20, your actual cost per click may be only $1.01.

Quality Score

Quality Score is a key metric used in Google Ads to evaluate the relevance and usefulness of your ads, keywords, and landing pages to users. It is expressed as a numerical value from 1 to 10, with 10 being the highest.

Main components of the quality indicator

1. Expected CTR (Click-Through Rate)
   This is the probability that a user will click on your ad after viewing it. Google takes into account:
   • The historical performance of your ad with a specific keyword.
   • The overall behavior of users towards similar ads.
     The higher the CTR, the more likely you are to get a high Quality Score.
2. Ad relevance
   Google analyzes how well your ad meets the user’s needs, taking into account:
   • Ad content (title, description, keywords).
   • Does the ad match the specific query?
     For example, if a user searches for “buy sneakers” and your ad is about “sportswear,” this could negatively impact relevance.
3. Google’s Landing Page Experience
   measures the quality of the page a user is redirected to after clicking. Key factors include:
   • Does the page content match the ad text and keywords?
   • Ease of use of the site (loading speed, mobile adaptation, ease of navigation).
   • Is the page informative and does it provide the user with useful data?

Why is the quality score important?

A high quality score has the following advantages:

• Lower advertising costs : If your ads have a high Quality Score, Google may offer you a lower cost per click because your ads provide more value to users.
• Better ad positions : A high Quality Score increases the chances that your ad will appear higher in search results.
• Increased effectiveness : The more accurately an ad matches users’ needs, the more clicks, conversions, and overall campaign success.

How to improve quality score?

1. Optimize CTR
   • Use catchy headlines and clear calls to action.
   • Test different ad variations to find the most effective ones.
2. Ensure your ads are relevant
   • Include keywords in your headlines and ad text.
   • Use exact match keywords (e.g., exact match) to avoid irrelevant impressions.
3. Improve landing pages
   • Maintain high page loading speeds.
   • Ensure mobile optimization.
   • Make sure the page matches the ad in terms of content.
4. Analyze and adapt strategies
   • Constantly check your campaigns for effectiveness.
   • Use Google Ads tools to get recommendations for improvement.

“Clients often underestimate the importance of Quality Score, focusing only on bids. But it is this metric that helps optimize budgets and significantly improve campaign results. We always start by analyzing the Quality Score for each keyword and build a strategy based on it.”

How is the quality score evaluated?

Google doesn’t provide an exact algorithm for calculating Quality Score, but you can see it for each keyword in your account. It’s a tool for evaluating how well your ads are responding to users’ needs.

“Ad quality is as important as budget. Sometimes a smaller budget can beat your competitors if your copy and page are perfectly aligned with users’ needs.”

Keyword relevance

Your ads should accurately match the search queries you’re targeting. To do this, use:

• Specific keywords.
• Negative keywords to exclude irrelevant queries.
• Responsive Search Ads.

Expected impact of the extensions

Ad extensions (e.g., links to subpages, call buttons) also affect Ad Rank. They increase the visibility and appeal of your ad.

3. How to improve quality indicators and reduce costs?

Increase CTR

• Use clear, compelling calls to action (CTAs), such as “Learn more” or “Order now . ”
• Test different ad formats.

Landing page optimization

• The page should load quickly and be mobile-optimized.
• Ensure relevance between your ad text and the page content.

“The user experience on the page directly affects your budget. Sometimes it’s worth investing in site design rather than spending more on advertising.”

Working with keywords

• View search query statistics and add new relevant words.
• Use different match types (broad, exact, phrase).

Bid optimization

• Determine the maximum cost per click for each campaign.
• Use automated bidding strategies, such as Maximize conversions or Target return on investment (ROAS) .

4. What criteria determine the position of an ad?

1. Ad Rank is the main ranking criterion.
2. Competition – the more participants in the auction, the higher the competition.
3. Expected impact of ad format — more detailed ads are favored.

📊 Tip :If your ads are in lower positions, try improving the quality of your text and landing pages before increasing your bids.

5. Conclusion

The Google Ads auction is a complex but effective mechanism that allows advertisers to reach their target audience. Understanding how it works, improving your Quality Score, and optimizing your bids will help you reduce costs and maximize results.

“In Google Ads, it’s not always the one who pays the most who wins. Smart strategy and optimization are the key to success.”