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Media and Communications

Sobre o leilão do Google AdWords (Legendado PT-BR)

Sobre o leilão do Google AdWords (Legendado PT-BR)

hi I’m Hal Varian I’m the chief economist here at Google Google uses an auction system to rank the ads that appear in the search results page and to determine the cost for each ad click in this talk I’ll take you through a general overview of how the ad auction works first and foremost Google users want ads they see to be relevant they don’t want to be bothered with ads that aren’t closely related to what they’re searching for an advertisers want to show relevant ads so users will actually click on them meantime Google wants to provide a good experience for users and a good value to advertisers so they come back and use their services again in the future now I’d like to walk you through what a traditional auction looks like say we have for advertisers competing for space in the search results page and each has indicated a different amount they’re willing to pay for user to click their ad and visit their website $4 $3 $2 and $1 I refer to these amounts as the bids now in a traditional auction ad positions will be determined exclusively by bids the highest bidder would get the first position second highest bidder the second position and so on Google uses a variation of what’s called a second price auction and in a second price auction the buyer doesn’t have to pay their full bid they only have to pay the amount of the next highest bidder below them so in this particular case the first advertiser was bidding $4 they’d only have to pay $3 which is the bid of the second highest advertiser same thing applies to advertiser two and to advertiser three this design allows each advertiser to bid their true maximum willingness to pay for click but they only have to pay just enough to beat the competition now in our Google auction advertisers only have to pay when they actually receive a click and the order isn’t based just on bids why because we want to show more useful ads in a higher position on the results page because users want to see relevant ads advertisers want to present relevant ads to users and Google wants both advertisers and users to have a good experience so they come back and continue to use our system so we consider some other factors in addition to an advertiser’s bid the first factor is your expected click-through rate this is our prediction of how often your ad we clicked on when it shone all across Google we rely on user feedback to drive decision-making and user click-through rates tell us what Google users really respond to by allowing users to vote with their clicks we have millions of people are helping us to decide which ads are best for each search query the next factor is your ads landing pages perience an ad is only useful to user at the landing page that leads to helps them find what they’re looking for a highly relevant landing page yields a higher score what does a high quality landing page look like well should have relevant and original content that helps the user complete their task it should be easily navigable be transparent about the nature of your business how your site interacts with a visitor’s computer and how you intend to use a visitors personal information another factor that’s involved is add relevance Google determines add relevance by analyzing the language in your ad they determine how well relates to the query this is a way to measure the ads relevance to the users search and to make sure that only useful ads are shown it also prevents advertisers and simply paying their way on to search that’s unrelated to their product or service you expect to click-through rate the landing page experience and the add relevance or all factors that describe the quality of your ad we also consider the expected impact of any ad formats that may show with your ad ad formats or enhancements to search ads that more prominently show users information about your business things like a phone number or site links or your website’s domain in the ad headline advertisements with these formats give users more information the more reason to click on an ad so Google combines your bid with multiple quality factors to click-through rate the landing page the add relevant see as well as expected impact of ad formats to calculate a score for your ad called ad rank let’s go back to our four sample ad buyers and see how their ad rank compares here are four advertisers are bidding $4 $3 $2 and $1 their ads had different quality low high high and medium they also imply different formats with varying impact first ad doesn’t have any formats enabled so it has no expected format impact the second ad is only eligible for one format and as a low expected format impact and the third is eligible for several extensions and Garner’s a high expected impact and for the last ad it’s medium so in this example the first ad has an ad rank five next dad has an ad rank of fifteen third has an ad rank of 20 and the last ad has an ad rank of eight it’s this ad rank score that determines ad position the results page and in addition only ads was sufficiently high rank appear at all so with this ad with an ad rank of twenty it gets first position even though it has a lower bid why because of his quality and formats the second highest ad rank is 15 so that ad gets positioned to the third highest ad is 8 it lands in position 3 the advertiser up here who’s bidding $4 has such a low quality and format and impact that it doesn’t get a position the page at all despite having the highest bid so now we know how the ads are ranked but how much do you actually pay for a click we pay the minimum amount that’s necessary to maintain your position and any formats that are showing with your ad so let’s get back to our ad rank table and talk about the advertisement position 1 he’s competing with the advertiser position 2 so the amount he has to pay is going to be just enough to beat the ad rank of the advertiser in position 2 for example although he bid $2 he could have been as low as say 173 and he would still about rank the advertiser media below him so that’s what he’ll pay for click one dollar and 73 cents similarly the amount that advertiser in position 2 has to pay as a minimum needed to beat the ad rank of the advertiser in position 3 and so on down the page so in this example the top ranked advertiser winds up paying less than what he was actually willing to pay for a click and it’s the same for the other advertisers as well alright let’s talk about how verdi xor’s can influence their cost per click and ranking in the auction by improving your quality or adding ad formats you can potentially improve your ad position you could also end up paying a lower cost per click so let’s take a look at the advertiser in position 2 suppose she improves her add a landing page now our ad grant goes up to 18 her position here doesn’t change but what happens to how much she pays per click before even though she bid three dollars she only needed to bid say 268 to beat the ad rank of the advertiser meetly below her so that’s what she paid two dollars and 68 cents but now that she’s improved the quality of her ad assuming everything else stays the same she could have been as low as say two dollars and 42 cents to beat the advertiser be lower so her cost per click goes down to 242 why because the price and advertiser pays is partially based on her ad quality now imagine this advertiser wants to move to a higher position so she increases her bid to 350 now our ad rank goes up to 23 that’s enough to give her a highest ad rank and to move her into position 1 and what does she pay the amount that would be just enough to beat the ad rank of 20 below her assuming everything else stays the same that might be say 3 dollars and 38 cents in this particular case so to wrap up why do we handle add ranking and pricing this way like I said at the beginning it all goes back to the eco system Google or our users and our advertisers all living when users see better ads they’re happier and they’re more likely to actually click on those ads and that makes advertisers have here which makes Google happy because with happy users and happy advertisers we get more people using our system if you have more questions or want more information please visit adwords.google.com slice support and thanks for your attention

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