Google sent an e-mail to AdWords advertisers today announcing an algorithmic change to the matching of ads and keywords. For now, the change affects only broad-matched keywords associated with AdWords ads displayed on Google.com, but Google promises the improved relevance will ultimately affect other matching options and other portions of the advertising network. Characteristically, Google is not divulging specifics. But it is clear that broad matching will no longer be as broad. Although Google expresses a somewhat defensive tone in the e-mail and related FAQ, the truth is that this change should be good news for advertisers, especially those who rely on broad matching to eliminate the work of fine-tuning keyword. Here is the example Google uses—

"For example, an advertiser specializing in Alaskan cruises may have selected cruises (broad-matched) for their campaign. Previously, this keyword may have been disabled due to poor performance on more popular queries such as Hawaiian cruises. Instead of disabling all broad match variations of cruises, we will now show this ad for specific query variations that are more relevant to the ad, such as Alaskan cruises."

The big question is HOW—how will Google determine niched relevancy in an ad? Is the change really algorithmic as I stated above, or will human resources be used to evaluate ads? (The second possibility is far less likely than the first.)

One implication seems clear: Google is de-emphasizing broad matching in favor of exact matching. This is a change long-awaited by careful advertisers who would rather eat glass than throw a broad match into their carefully regulated campaigns. The benefit for advertisers who continue to use broad-matching is that entire keyword sets (determined by a broad match) will not necessarily be disabled due to poor clickthrough rates. If the keywords are matched more intelligently to start with, the chances of poor performance are lessened. Is it possible that Google is using this after-the-fact determination to refine the matching relevancy? Nobody outside Google knows, but some posters at WebmasterWorld are already seeing changes in ad positioning.