Google CPC Issues

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Hoping I could get some input/discussion about some Google Adwords CPC issues I have been having for the past year. I'll lay out the scenario and would appreciate any creative solutions, similar stories, etc. anyone can share.

One of my clients is in the educational services industry. They provide a financial aid service for college students. There are no competitors, hence no competition for Google PPC advertising.

In early January 2012, my client's CPC on the primary industry term started to increase. According to our Google team, this was the impact seen from an algorithm change in Nov. 2011. To combat the CPC rise, someone internally manually adjusted the CPC bids down which pushed them out of the top position. Their ads were now showing at the bottom of the page. CTR dropped, and hence so did quality score. This lasted about 5 days.

The bids were brought back up, but the damage appears to be irreversible. Quality score and CTR is actually better than it had been, but since March 2012, this company's Google CPCs have increased 190%. They are getting 18-20% CTRs and there literally is no competition for this industry niche (nor has there been all year). They are the only ad that appears. Yet, the CPC continues to rise.

So, my questions:

- Has anyone experienced anything like this (I personally have not)?
- How does this happen?
- Any suggestions on tactics to test to drive CPC back down?
- Is this Google price gauging?
- I have been trying to escalate this internally above my account team, does it help to be vocal within Google?


Thanks for your thoughts in advance
#search engine optimization #adwords #cpc #google #issues #ppc
  • That is a huge niche and a huge player in adwords. There is very
    stiff competition. That is, unless you are bidding on worthless
    keywords.

    There is just no way financial aid for college students would have no
    competition.

    Anyway, one thing that people forget, is that everyone
    has a different minimum bid.

    I should also mention that your overall QS may be different than
    an individual QS for each keywword. If those are what you are
    bidding on, and your QS is lower, your CPC goes up.

    Your minimum bid can have nothing to do with how many are bidding.

    You don't have to use adwords.

    If the company's ROI is still worth it, it makes no difference.

    Paul
    • [2] replies
    • Thanks for the reply. I am not referring to the generic phrase "financial aid for college students"...agreed that would have more competition. This is for a very specific niche that has no competitors. We are the only advertiser bidding.

      My issue is that as the CPCs have gone up, the ROI no longer makes sense. I know that using adwords is voluntary, but this is where this company's customers start their research.

      My question was more about whether anyone else has seen anything like this. No competitors, great CTR, good quality score (at least at the keyword level), and a CPC that continues to rise despite no other market forces.
    • Hi Newton,

      Where did you get the idea that there is no competition? Even though it may appear that you are the only advertiser, that may not be true. You left out a lot of details that would be needed to give you an accurate answer.

      Are you using broad match keywords? That could be an issue that causes your QS to drop.

      Have you produced a Search Terms Report and verified all of the keywords that trigger ads? It is probably an issue of targeting keywords that you did not intend to target.

      It could be other things related to your overall account structure, or how you have organized ad groups, or which network(s) you are targeting, or your ad text, or landing page issues. We need specifics from you to get you a definitive answer.

      Google has indeed made significant changes to the AdWords system that require changes on your part to maintain performance, if you just set and forget it going to cost you a lot.
      • [1] reply
  • I find that very hard to believe. Just because you don't see any ads doesn't mean there's no competition there. Being in first position doesn't mean there isn't competition. In fact, your competition would be whoever comes in second at the time your ad is shown. There's a new report called Auction Insights that will show you who they are.

    That's not how it works. You make the same mistake many others do: you look at absolute CTR. Of course, it will drop when you position is down. We all know that click rate is lower at lower positions. That's why everyone is saying they are trying to be first in the rankings, it's to maximize the clicks.

    But QS is calculated taking position into account. It's a relative measure. If your QS has dropped, there's something else in play. That's why when you increased the bid, the QS stayed the same even though your absolute CTR increased as expected. You'd expect CPC to increase as well which is what you are experiencing.

    You need to rethink your ads and bring the relative CTR up. Google will tell you the same thing. They are not there to build your campaign themselves. It's a self-serve service.

    You say you have great CTR. You don't know that. It may look great to you. What you really should look at is the QS. You are complaining about it so it means your CTR is not that great when compared to competitors past and present and I believe world-wide. That's what QS is telling you. IMO, if it's 7 and above, you are good. Of course, always try to improve it.
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    Google CPC Issues

    Hoping I could get some input/discussion about some Google Adwords CPC issues I have been having for the past year. I'll lay out the scenario and would appreciate any creative solutions, similar stories, etc. anyone can share. One of my clients is in the educational services industry. They provide a financial aid service for college students. There are no competitors, hence no competition for Google PPC advertising.