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The questions I have are:
Is there a great difference in click thru's from postion one to position two to position three.
IF you are an e-commerce site is there also a ratio difference. For example if you are position one is your conversion rate higher than in position three.
Are your products and prices competitive compared to the your competitors.
Does the presentation of your products give consumers confidence to buy from your company.
Being at number 1 is more expensive - being at number 3 may mean you don't get the traffic.
I believe, as a general rule, that people will visit each site in the top 3 (at least) comparing product and services. Then go back to the site that offers the best overall.
Get the presentation right (This is most important advise) and start at number 3. After a while experiment with 2 and 1. See what happens.
I look at the competition, if the title and description is HOT, I need to be at the top. If I read it and it is either:
1 selling something different
2 so poorly worded no one will click on it
Then I choose the cheaper option.