Because you can bid less and still have your ads shown on the first page. In my experience it isn’t unusual to see the following:
A Portion of The Keyword Report from ClickEquations
On the top line we see a keyword with a FPBE of $1.93, a MaxCPC of $1.50, and an AvePos of 2.82 (clearly on the first page). And we see a healthy impression count. It seems like something doesn’t add up.
I can only surmise (I have no direct information from Google on this) that this proves it really is an estimate. The actual bid required to be on the first page varies on a query-by-query basis. (Our post on the Quality Score discount or penalty.) This makes sense given what we now know about how Ad Rank is calculated and the fact this is done in real-time for every query. So for each search Google:
- Calculates the Quality Score of each bidder, then
- Calculates their Ad Rank to determine position, then
- Determines price based on the Ad-Rank and Quality Score, then
- Figures out if any ads are eligible to get a Top Position, then sometimes
- Decides how many ads they want to show
So there are two chances for your ad to not appear on the first page:
- Your Ad Rank is too low to earn a spot on the first page. This (again) is Bid x Quality Score so you have to variables to work on to fix this.
- Google limits the number of ads they display, even though there are more bidders.
What This Means For Bidding and First Page Bid Estimate You shouldn’t feel compelled to bid all the way up to or past the FPBE number. Check your Average Position, and Impression counts before making a decision. The effect of seeing the First Page Bid Estimate is to feel compelled to raise your bid to hit it – at least. That might be a good idea, it might not, and it may not be necessary (assuming your goal is a page 1 appearance with 100% Impression Share). Test the impact of bids around the FPBE on both your position and impression count – it’s possible you’re below but losing very few impressions. What Else It Means Google is still hiding too much from advertisers. The move to First Page Bid Estimate was a positive one, but we’re still not told:
- How they decide how many ads to show for any given query,
- How they establish minimum bids for a particular query (the price the lowest appearing person pays)
- How they determine the bid requirements of a Top Position (and what it is for any particular keyword or query)
- And our only clue about any of this – Impression Share – is still available at the Campaign Level only.
We’re left guessing and testing when we’re rather be considering and deciding. NOTE: This is the 2nd post in a series. The first one is here.