Since Google introduced the latest update to their AdWords Ad Rank algorithm in October of 2013, anyone expecting solid search ranking and lower cost-per-click without the the use of ad extensions needs to reconsider their strategy. Not using ad extensions just isn’t an option anymore.
Ad Rank is the algorithm Google uses to determine ad cost as well as ad placement. Maximum cost-per-click and your Quality Score are the two primary factors for how your ads rank on Google, but Ad Rank now takes into account the “expected impact from ad extensions and formats” as well, giving more importance to the quality and position of your ad extensions. In other words, Google has developed a way to determine ad performance using factors like click-through rates (CTRs), relevance, as well as how visible formats and extensions are on the SERP (search engine results page).
SEE ALSO: Google AdWords Spring Cleaning Checklist
This change will most likely affect small to medium sized businesses that lack both the time and budget to invest in exhaustive AdWords campaigns and sufficient campaign monitoring. These smaller companies might opt to forgo AdWords ad extensions until they’ve had time to test the waters. Our advice to these companies: Don’t wait. The changes made by Google have been implemented and they are affecting you now. If you’re not using ad extensions you can expect to see your position fall while your cost-per-click (CPC) rises, which is not good for your Quality Score or your budget.
So what are ad extensions?
Ad extensions are free tools that allow you to amp-up your AdWords campaign by showing extra business information to help customers get a better handle on who you are and what you offer. Ad extensions will also improve the visibility of your ads since they increase your ad’s expected impact. As a result (and developed with quality in mind), your ad is often displayed front and centre above the search results, as opposed to along the side bar. Ad extensions are also a solid option since they bolster your ROI (return on investment) by improving your CTR.
Yep, they’re FREE. Sound too good to be true?
It’s not. Ad extensions themselves are free – just bear in mind you are charged for clicks as you would be with a normal click on your ad. You’ll also be charged if the extensions facilitate certain interactions, like clicking on a call button, directions icon, download button, etc. Exceptions to this rule include clicks on reviews, social annotations and seller rating annotations. AdWords charges a maximum of 2 clicks per impression on each ad and that ad’s extensions. The most you will pay is the minimum payment required to keep your extensions in position.
How do ad extensions work?
You can choose from a variety of different ad extensions that can help improve your AdWords campaign. Here’s the run-down of your options.
Types of Ad Extensions
App extensions. App extensions appear as a link below your ad text and directs people to the app store or can provide instant download. Obviously, these ad extensions are ideally suited for businesses who have apps available.
Call extensions. This sort of ad extension allows people to click a button to call you directly. This is especially helpful for businesses like take-out restaurants, where the customer wants to get in touch quickly and one of the primary methods of communication is the phone.
Consumer rating annotations. Boast a little about your quality service by showing customers rave ratings.
Location extensions. Location extensions allow people to find your nearest store or give you a phone call. These ad extensions are invaluable for people who have actual storefront businesses with customers who would want to know their physical proximity to your location. Tip: Up the ante by linking your Google Places account to AdWords so potential and existing customers can see your star rating along with your location extension.
Previous visit annotations. This kind of ad extension allows people to see if they’ve clicked through to your site via Google Search results in the past. Consider it a little reminder that could result in better conversion rates.
Review extensions. Give potential visitors a snapshot of your happy customers by sharing positive reviews.
Seller rating annotations. Display your online business ratings along with your ad to help encourage conversion.
Site-link extensions. Add in links to help direct people to their desired destination. Site link extensions allow you to show links to additional landing pages that provide more specific options. So, for example, if you are searching for shoes and you know what you’d like, specifically (i.e. men’s dress shoes) an ad extension would allow you to display a specific link for that specific type of shoe. More people click-through when there are site-links even if they don’t click the site-links themselves. Almost any campaigns CTRs (click through rates) will benefit from using site-links. Don’t believe it? Try using them for just one campaign or ad group and then monitor their success against campaigns without extensions. Just bear in mind that Google only shows site-link ad extensions if you’re in a top spot, so you may not be able to see the site-links.
Social annotations. Social annotations show everyone how many Google+ followers you’ve accumulated. With social media recommendations gaining major traction as a marketing tool, this ad extension is too good to overlook. Not on Google Plus? This is another reason why you should be.
Offer extensions. Offer extensions are perfect for marketers who wish to attract more foot traffic to their store. This is incredibly useful for places that sell products or services that don’t work well online, like a daily special ice cream or a spa treatment. The idea is to attract clients into the store, where they will be more likely to revisit it.
Creating ad extensions
Creating new ad extensions is fairly simple. Each extension comes with its own set up instructions, best practices and reporting methods. Annotations do not need any set up, providing you meet certain criteria. Annotations appear automatically when AdWords think that they will help improve your ad’s performance. Annotation formats include previous visit annotations, seller rating annotations, social annotations and consumer rating annotations.
Once you have created an ad extension for a particular campaign you can use it for other campaigns. You can also edit and remove extensions at your discretion.
The Visibility of Ad Extensions
As mentioned, AdWords will not automatically show your ad extensions. AdWords displays your ad extension(s) with your ad when it determines that the extension will help the performance of your campaign. Your ad extension(s) will appear when your ranking is suitably high enough. While there is no guarantee that adding an extension will secure its place in your ad, you can see when your ad extensions are showing up by checking out the Ad Extensions tab. Your ad extensions may not show for a variety of reasons, including:
- your ad’s position (above the search results or on the side bar)
- your Ad Rank
- your keyword quality and max CPC
- the presence of your other ad extensions
Setting up and implementing ad extensions is a simple and quick progress. This said, it can be tough to decide what ad extensions are best for your business – even if you understand what the extensions themselves do. The truth is Google’s new AdWords algorithm can make it difficult to understand just how your campaign will be received. The new platform has drawn a line in the sand, and admittedly, the line keeps moving. It can be hard, but it’s not impossible to predict and accommodate these changes. It just takes some time and management. Unfortunately, if you don’t have these resources, your online marketing presence can suffer – but it doesn’t have to.