Anybody else seen this? Is it simply related to the clickthrough rate, or is there more to it?
The reason is this: If a searcher sees the same URL in both the SERP and the sponsored links (especially if the text is similar), then that site may appear to be more "desirable", and thus he may be more likely to click on the ad. This, in turn, raises your CTR, which helps your position.
So all things equal two advertisors fighting for first place, both paying the same ammount google puts the ad with the higher click through rate in front, and actually the person with the high click through rate could be paying less that a person who has a lower CTR and still have a better position.
With time a better written ad can out perform the person who got their first and end up getting the better position in the long wrong.
There are mathematical ways to show how positions and per click charges are derived but it comes down to a simple matter of average CPC * average CTR determining who gets to be top.
You can bid half your competitor and still be above them due to a much better CTR.
I'll not explain the full implications, if you make money through adwords then I'd expect a little time invested in finding this stuff out.
Don't be fooled by 'other factors', it is simple to grasp but not always simple in practice.
Come on folks, the mechanics of adwords is well enough known. It's a combination of average CPC and CTR.
There are mathematical ways to show how positions and per click charges are derived but it comes down to a simple matter of average CPC * average CTR determining who gets to be top.
It used to be that way in the past. Well actually Max CPC * CTR, but Google changed it this year to include other "ad quality" factors which they refuse to disclose.
So, ad text relevancy is in the mix! Thanks RedWolf.
The first one in with a good ad does have an advantage.
I have found it a LOT easier to maintain number one spot as a particular field gains more advertisers, and conversely, i find it harder (more like 'annoying' actually) that its not JUST a case of outbid/CTR when i enter a more saturated niche
The idea that serp listings may a a favourable impression on your adwords is not something i have thought about fully- innteresting idea. I have hesitated to go advertise for a keyword if im in the top 3 results
Im fairly confident in my ability to write decent copy, therefore get decent click throughs, but its not that simple as far as i can see
any other ideas or experiences?
As far as the first in advantage, I don't try to go out of my way for first place. If I get it, fine. IF not, second or third position isn't that bad especially of the first is a junk ad from ebay or one of the fake shopping sites that my customers knows does not offer the products they are looking for.