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Google AdWords is a great way for Realtors to increase the amount of prospective buyer and seller traffic to your website.  Charts show that more people actually click on the first few "organic" search results than click on ads listed above them; however, the evidence cannot be ignored and Google AdWords does work to drive traffic to your personal real estate website.  Just like everything else in life, the unknown in real estate marketing is scary.  So, let's eliminate this fear of the unknown of Google AdWords by showing you how Google determines what you pay for your ad.

The Auction -

Google uses an "auction" in determining which ad gets placed in a certain position in their search results.  The auction determines 3 things:

  1. Which ads show on a particular search results page – Google first looks for all eligible advertisers based on keywords and other target settings, such as geographic location.  Each search results page can have up to 15 ads per page.
  2. How the ads are ranked (order of placement of your ad) – Google now uses AdRank to determine where ads are ranked in their search results page.  AdRank is calculated by multiplying the advertiser's maximum bid by their Quality Score.  An advertiser's Quality Score is a measure Google uses to determine how well your ad and the page where you direct your visitors match what searchers are looking for.  Google will then rank the ads for that keyword from highest to lowest based on AdRank.  Below is a picture of how AdRank works to give you an example.
    Google AdWords for Real Estate
  3. The cost each advertiser pays per click – Your AdRank is divided by your Quality Score and you will pay $.01 more than the maximum bid of the next advertiser.  Therefore, you often will pay less than your maximum bid.  You should note than an advertiser with a better quality score can actually pay less than other advertisers and have its ad appear higher up on the page.

So having success with Google AdWords is more than just outbidding the last advertiser since Google's "auction" is not  really an auction.  Your Quality Score plays a huge role in determining which ad shows up where and how much that ad costs.  Google AdWords allows advertisers to choose how much it will pay for an ad and how often that ad displays.  You may even set a daily budget to limit your spending on the service so that you don't wake up one day to find a huge advertising bill being charged to your credit card.  Take some time to learn a little more about Google AdWords and begin implementing it in your business this Spring to help increase your pipeline of prospective buyers and sellers.  If you are already using Google AdWords in your marketing efforts, please tell me how it is working for you in the comment section below.

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