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I wouldn't have throught it does although I have found adverts which only seem relevant to one of the keywords used in the search query.
Do the different PPC engines have different algorithms for this activity?
Generic KWs for the most part don't convert as well as more targeted KW phrases.
In adwords that KW would show for all combinations. NOT GOOD but you can put limiters on KW phrases.
I'd be interested in what people have to say about how MatchDriver2 would deal with that on Overture.
In which case I have a another question - how does the search engine (adwords in this case) decide which advert should go first.
E.g. company A bids for 1st place on the word 'holiday'
company B bids for 1st place on the word 'backpack'
If a user searches on 'backpack holiday' which advert appears first? How do search engines work this conundrums out?
[adwords.google.com...]
Regarding which would get priority, the factors deciding position here would be maximum CPC prepared to pay and CTR, so the one that has the more relevant ad to the search should win the day.
The sequence would be :
:Look for exact match [backpack holiday]
:Look for phrase match "backpack holiday"
:Look for word match backpack holiday
As neither of the first two apply the last one would apply, and because the keywords are classed as equal the budget and the CTR would be used, but also the ads will be shown in rotation.