Brad Geddes / PPC Geek
Official Google Ads Seminar Leader.
Author of Advanced Google AdWords.
Co-Founder, Adalysis.
(703) 828-5811‬
Brad Geddes's Theories on Marketing What determines the Minimum Bid for AdWords?

What determines the Minimum Bid for AdWords?

Last week we covered:

It’s now to move into how minimum bids are used and calculated.

The minimum bid for AdWords is the least amount you can pay and have your ad appear on the search network. If your max bid is below the minimum amount, then you can be shown on the content network, but you will not be shown on the search network.

To find your minimum bid, navigate to an Ad Group within your account. You may have to customize your columns to view this information.

The below screenshot shows the minimum bid. Essentially, if you max cost per click is below the minimum bid you can either attempt to increase the quality of your advertising, or bid higher.

The are two major differences between keyword quality score and minimum bids. The first is that the landing page is used for minimum bids, and not for keywords. In that respect, minimum bids are similar to the ad group quality score formula (ad group quality score uses the landing page and determines your ad rank for the content network). The second is that the ‘other relevancy factors’ are not weighed heavily in minimum bids as they are often based upon the predictive CTR of that search, and those items can’t be taken into effect until the search actually happens.

Factors that affect minimum bids are:

  • Click through rate on
    • Overall history
    • Most recent history
  • Ad copy
  • Landing page
  • Account quality score
  • Other relevancy factors (very low weight)

To learn more about what the relevancy factors mean, please see the quality score factors page.

Essentially, Google first tries to quantify how much they think you should pay as a minimum to have a keyword show up in a search result. This is based upon how they think your ad will contribute to the user experience.

If the above factors mean you are contributing towards a good user experience, you will have a low minimum bid. If you are not contributing something unique to the experience, then you will have a higher minimum bid.

This should not be confused with max cost per click. The max cost per click is what you are willing to pay for a visitor – it’s a number you decide. The minimum bid is the least amount you must pay to be shown for search – and it’s a number Google decides.

However, even if you have a high minimum bid, meaning it’s not a great user experience – if you are willing to pay those prices – then your ad can show up in search.

Once you are bidding over the minimum, then the minimum bid doesn’t matter any longer. The keyword quality score will take over as that’s what’s used in the ad rank formula.

In short, the minimum bid uses all of the keyword quality score factors plus the landing page. Hence, you can have a high minimum bid and a good keyword quality score. In that instance, it’s the landing page which is causing the high minimum bid.

The reason you can have a keyword inactive for search and still show up on content is that the ad group quality score uses the landing page where the ad rank formula keyword quality score does not. Therefore, the landing page is still used in both scenarios, it’s just in a different combination.

Since minimum bids use every single factor available in determine account, ad group, or keyword quality score – it’s one of the best places to examine your quality score.

If the minimums are higher than you’d like, it’s time to examine the factors that contribute to the minimum bid and see how you can create a better user experience.

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