Using The AdWords Auction Insights Report

Last week, Google released a super-sweet new report to all AdWords accounts. It’s called the Auction Insights report, and it gives you greater visibility into who is competing with you at the keyword level. This new report is a huge boon for competitive analysis, and is about to make the AdWords game just a little more interesting.

Before I get into how to use this report, let’s talk about how to find it. As of right now, you can only run this report one keyword at a time, so you’ll have to go to your Keywords tab in your AdWords account. Choose a keyword that you want to analyze (I find that looking at your keyword that drives the most clicks and/or conversions works well) and tick off the checkbox next to it. Then, click on the “Keyword Details” drop-down and select the “Auction Insights” option:

AdWords Auction Insights selection

Run the report, and you’ll get something like this:

AdWords Auction Insights Report

This report will give you the domain URLs of the advertisers that are competing with you on that specific keyword, along with a few key metrics:

Impression Share – How often a competitor in this keyword auction received an impression, as a proportion of the auctions in which your ads were also competing.

Average Position – The average position in which a competitor’s ads appeared.

Overlap Rate – The rate at which a competitor’s ad received an impression when your ad also received an impression.

Position Above Rate – The percentage of the time a competitor’s ad showed above yours, when both you and the competitor received an impression in the same ad auction.

Top of Page Rate – How often a competitor’s ad showed at the top of the page.

So now you know the method and the metrics. But what do you do with this information? The greatest use I’ve found for this report so far is competitive analysis. Sort your report by position above rate, then select the URLs of everyone who is showing above you at least 50% of the time. Then, do some Googling to find their exact landing page. Review their offers (both on the text ad and the landing page) and see how you stack up. You might be surprised that your competitors are undercutting you on price, or using some other tactic like free shipping or fast returns to try and one-up you. You might be losing conversions due to an inferior offer, and if your competitors are showing above you more than half the time and offering up a better deal to customers, that could spell serious trouble for you.

You can also use this report to find out who the big spenders are in your vertical. If a competitor shows up in Auction Insights for multiple keywords and always seems to have a high average position and high top-of-page rate, this will indicate that they’ve got deep pockets and are likely spending a lot on PPC. Using this method, you can identify who in your category is likely to try and start a bidding war for top positions, and learn how to outmaneuver them with smart keyword bidding.

This report is a serious game changer for AdWords. Before, you had to rely on third party tools to see who your AdWords competitors were, and you had to shell out some serious cash to find out stats like the metrics defined above. Advances like this, new bid automation methods, and continued improvements to Google Analytics tells me that Google is out to undercut third-party vendors of PPC and analytics software. You can’t beat that free price tag, so I would be wary if I were an employee of Adobe, Marin, Acquisio or any of those other folks out there with search engine marketing software packages.

Anyone else have some neat hacks for this new report? Let’s hear about them in the comments.

About Shawn Livengood

Shawn Livengood is a search engine marketing professional based in Austin, Texas. He has extensive experience managing pay-per-click ad campaigns for clients in various industries, from small home-based businesses to large international companies. You can connect with Shawn on Google+.
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2 Responses to Using The AdWords Auction Insights Report

  1. Jamie says:

    Shawn,

    Great insights, pun intended. Makes it very apparent what competitively is happening for a good compass, and seemingly more reliable than a third party tool. Also it may serve as a nice deck addition to an executive summary to show stakeholders who else is in the space, how we fair up in auctions, why the market is tough to crack/easy to own, etc., and all on a tactical level. Pretty telling, esp. when you don’t realize who some of your competitors may be (e.g. Google!) when doing ad previews/research and budgets are up, or ads are off that one day you do your research.

    Do you think this new insight is continuing an aggressive roadmap to pull in third party tool functionality to negate the tool market? I noticed this with DCLK, their ad spend margin is the lowest of all bid mgt tools. With Managed Rules over the last couple years, at what point will AW pull in DCLK functionality, or even go the step further to bring in auto-optimization functionality, ala Kenshoo, Marin, etc?

    Jamie

  2. Excellent points, Jamie. I think that AdWords is well into auto-optimization functionality territory with features like Conversion Optimizer, ad rotation settings to optimize for conversions, automated bid rules, etc. I expect them to add in more functions along these lines in the years ahead, as PPC management grows larger and more complex. We’re already at the point where most larger PPC accounts can’t be effectively managed by a single human mind, so a certain level of automation is necessary.

    In today’s PPC software marketplace, there’s a huge discrepancy between the cost of a software package and the actual value it provides. Probably 90-95% of PPC accounts are priced out of software packages since they’re already paying ad spend, plus salaries for in-house folks and/or agency consulting. Tacking on an additional 3-10% of your ad spend in cost just doesn’t make sense for most advertisers who are looking for automation software. Considering this, I think that Google’s foray into free automation features is a good thing, as it will force PPC software companies to lower their prices to a more reasonable level and offer a better value for consumers.