Google offers four different bidding methodologies. I detailed the advantages and disadvantages in today’s Search Engine Land Paid Search column.

Here’s a quick compatibility chart to see the functionality of each bidding methodology.

Quality score remains one of the more ambiguous ideas on the web. Google has become much more transparent with sharing information about AdWords quality score.

Microsoft adCenter has also announced it will use a quality score formula to determine placement. I’ve had some discussions with Microsoft digging into the full algo, however, here are some high level facts that will help you optimize for adCenter’s quality score.

• How closely related the keyword is to the ad’s content (single factor)
• How closely related the query is to the landing page (single factor)
• How closely related the keyword is to both the ad and landing page (combined factor)
• The serial chain of query to ad and then ad to landing page
• Uniqueness of the ad to other ads on the page. adCenter tries not to show duplicate ads on the page (this is an interesting one).

Overall, it’s fairly similar to Google’s.

The concept is quite simple: If you are enhancing the search process, then ads rank well. If you aren’t, then ads rank lower.

The search process is quite simple and very complex at the same time. I’m not talking about algorithms and results, but how people going to a search engine actually conduct a search process.

Understanding the psychology behind the search process makes us better advertisers and SEOs.

Let’s examine how people search in order to learn how to connect with them.

The first step is why people go to a search engine.

People don’t go to a search engine to browse the web. They go there because they have a question to be answered.

The question could be how to spell a word, where to buy a book, a nearby plumber’s phone number, or how to back up MySQL. The potential questions are limitless.
The basic reasoning is simple. You don’t know a piece of information, and you wish to find it.

What determines the search query?

Most people don’t think in words, most of us think in concepts and pictures. The way those items are translated into words are known as ‘keywords’ or the ’search query’.

While that sounds simple, this is very complex. Consider this scenario:

It’s February in Chicago and the temperature doesn’t break 10 degrees for two weeks. On Saturday evening, the frigid air causes the pipes in your basement to freeze, and then to burst, which floods your basement. You’d like a plumber to come out immediately to pump fix your pipes and get rid of the water in your basement.

This is a scenario which happens almost every year in Chicago. What are the ways someone could interpret those events to type them into a search engine? This is by no means a comprehensive list, it’s just a small sample set of possibilities:

• plumber
• Chicago plumber
• weekend plumbing services
• broken pipes
• flooded basement
• how do I get water out of my basement?
• emergency plumbing services
• 60626 plumber
• plumber website
• plumber phone number
• emergency pipe repair
• frozen pipe help

The list can go on and on. Each one of us interprets events differently. We also describe the same scenario differently. However, each query is relevant, and each of the above keywords is how people look for answers.

The SERPs - Expectations

The next step is typing your query into a search engine. SERPs stands for ’search engine results pages’.

It is important to remember, as humans, every time we do an action, we have an expectation of what is to come.

In the current scenario, we would expect to see results about finding a plumber in Chicago who can come to our house on a Saturday evening to fix the basement.

If we see ads and websites that don’t connect with our current interpretation (the keyword query), searchers are less likely to click on them. The closer the ad (or website description) matches our query, the more likely searchers are to visit that website.

The SERPs - Connecting with Answers

The query is typed, the enter key is hit, and within seconds the searcher is presented with many possible answers.

At this point in time, there are five possible scenarios:

1. The searcher sees a possible answer and clicks on a result (ad or natural result)
2. The searcher doesn’t see anything that meets their expectations and refines their query
3. The search clicks on another result type (maps, images, etc) looking for an answer
4. The searcher decides to try the search on another engine
5. The searcher abandons the quest for answer

The marketers job is to connect with the searcher. The ad or result should be waving it’s hand and saying ‘I have your answer, come click on me’.

If one of the results on the page connects with the searcher, holds the promise of an answer, and meets the searchers expectation, a click generally occurs.

The Landing Page

You achieved the click, brought a new visitor to your website, now what? The battle for conversions is not over.

You must still meet the searchers expectation. Before the searcher clicked from the SERP to your website, they had an expectation of what information they would see on the landing page.

• Does your landing page meet their expectation?
• Does it contain the answer?
• Does someone know what to do next?
• Should the searcher hit the back button?

The page must meet the searchers expectation. It should be a continuation of the ad copy for the landing page to convert. Any forms should be simple. You aren’t trying to surprise the visitor, you are just simply answer their question and telling them the answer (i.e. the plumber’s phone number) , or how to achieve that answer (shopping cart).

The Search Process is Linear

1. We search because we’re seeking information.
2. We all interpret events differently, how an event is interpreted determines the search query.
3. When one does a search, we have an expectation of the search results possibilities.
4. An offer on the SERP page should connect with the searcher and hold the promise of an answer.
5. When one clicks on SERP result, they have an expectation of the website.
6. The website should direct the visitor to find the answer.

When all of the above are done in a fluid process - conversions happen. Searchers find information. Businesses make money. The process continues.

The concept of search is simple, I have a question and I’m looking for an answer.

The process of meeting people’s expectations is complex.

Understanding the Psychology of Search should put you on the road from simply ensuring your website is on a search result to driving conversions for your business.

Useful for fequent flyers who aren’t using Worldmate (my favorite travel smartphone program)

Google SMS is a free mobile search service that responds to users queries via text messages. Information currently available through Google SMS includes phone book listings, local movie times, weather reports, product prices, definitions and more. In this release, flight status information has been integrated into the SMS technology. To use this feature simply text your flight number (e.g. AA 2222) to ‘Google’ (466453) and you will receive the flight status information back.

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Google recently changed their conversion tracking script so that it is now compatible with mobile ads.

Can I track mobile ad conversions?

Conversion tracking is available for both the PC- or mobile-version of your website.

Learn more about setting up conversion tracking for your mobile website.

Source: AdWords help files

Preferred Cost Bidding allows you to set your bid prices to your average CPC and not your max CPC

You can enable this for both CPC and CPM (site-targeted) campaigns.

This is very useful in three different scenarios:

1. You know your value per keyword. If you have the data that says keyword 1 is worth $4.23, and keyword 2 is worth $3.56, then instead of ‘guessing’ what the max CPC should be, you can set your preferred cost at those actual prices.

2. You want more control over expenditures. When setting max CPC, your click cost can vary widely from day-to-day. With preferred bidding, you have much more control over how much you actually pay for keyword. This makes it so your average spend per keyword should be much more consistent.

3. You don’t want to spend all day reconfiguring bids. Since preferred bidding changes your max CPC behind the scenes to reach your actual bid price, there’s a lot less work in adjusting bids with preferred cost bidding.

How does it actually work?

With preferred cost bidding, you can set your preferred click cost at the keyword or ad group level. Behind the scenes, Google then adjusts what your max CPC should be so that your actual click cost comes out to be in your preferred cost bidding range. (More on quality score and ad rank)

So, the same ad rank formula (ad rank = quality score X max CPC) still applies, just Google is doing an addition algo behind the scenes to determine your max CPC.

Incompatibilities

Since Google needs control over your max CPC in preferred cost bidding, it’s not compatible with a couple of AdWords features:

Ad Scheduling advanced features. Preferred cost bidding works with the normal ad scheduling (which is essentially day parting or showing your ads at specific times of the day and days of the week). However, the advanced version of ad scheduling allows you to automatically change your max CPC at various times by a percentage. This advanced feature is not compatible with preferred cost bidding.

Position Preference. This feature allows you to control which range of positions you wish your ad to show. Since Google is changing the max CPC behind the scenes in position preference to determine your ad rank, this is incompatible with preferred cost bidding which is also trying to change your max CPC.

Will you overpay?

The first negative reactions I heard about this feature is that since you are setting a preferred cost, in times when you could pay less for the top positions, you could easily end up overpaying for ads (i.e. if your bid was $3, and it required you to pay $1 to be in the number one spot, the rumor was Google would charge you $3).

This isn’t true.

Google is still running the ad rank formula for all companies involved in the auction for a single keyword, and the ad discounter still applies as well. Essentially, the ad discounter calculates the values for all companies in the auction process and reduces your actual CPC to the lowest possible CPC you could pay to be in that ad position.

Enabling Preferred Cost Bidding

Preferred cost bidding is another bidding option. In the campaign settings, you’ll first want to ‘view and edit options’ under bidding.

Next, choose from one of the three bidding options:

• Set max limits - default bidding
• Set preferred bids - preferred cost bidding
• Budget optimizer - maximize traffic

Finally, choose how to change your current max CPCs to your preferred cost bids.

Preferred Cost Bidding can be very useful for controlling your ad spend, or for those who really understand the best bid by keyword or ad group.

I’ve been playing with it in a few accounts (it’s still in beta), and have been quite happy with the results so far.

It won’t be for everyone (the advanced ad scheduling being the one incompatibility I hope they fix), however, if you want more control over what you pay per click instead of what you bid per click, then it’s worth taking preferred cost bidding for a spin.

SES Latino was one of my favorite conferences last year. The mix of individuals who attended were quite different from the typical conference scene, hence, they had a different viewpoint on search that was quite interesting to hear and learn.

This year, I’ll be speaking twice at SES Latino:

June 18th: Buying Search Engine Advertising: Latino Edition
Paid placement is a form of search engine advertising that provides a top ranking in return for payment. Every major search engine offers a paid placement program. Even with the same search engine company, it may have a different method of selling paid search in Latin America. Learn what’s available in this session that is especially geared toward beginners, with details on programs from major providers and advice from advertisers.

June 19th: Targeting Spanish/Portuguese Search Ads By Demographics & Behavior
Attracting Latinos requires an in-depth knowledge about specific demographic behavior and culture. Search profiling makes it possible to target searchers with ads long after they’ve done a particular search. There are 3 primary languages spoken among U.S. Hispanics and Latin Americans and 25 countries of origin. In some cases, there are with different values, customs, behaviors, and attitudes to consider. This session will serve as a valuable guide to making your Search Ads more effective.

I expect this year’s conference to be as interesting as last year’s. And, who doesn’t want to spend a few days in Miami?

Hope to see you there.

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  MSNBC writes about free SEO tools.

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