I have a quick question about how Google matches your keywords. Consider this example:
I have the keyword "Green Widget" at Max CPC $1.00 on Broad Macth.
A competitor has the keyword "Widget" at Max CPC $2.00 on Broad Match.
The search term is "Green Widget."
Assuming that the CTR are the same, who's ad will appear first?
Hope someone can help. Cheers!
Based on the bid price, historical CTR & maybe some other factors, whichever ad is projected to make the most money for Google is shown highest.
I think the bottom line on this is Google always shows the ads that are likely to generate the most revenue for Google at that point in time when the search is performed.Based on the bid price, historical CTR & maybe some other factors, whichever ad is projected to make the most money for Google is shown highest.
This is often heard, but isn't really the case. It is entirely possible to appear above someone while paying less than they are - if your ad is judged by users as being particularly relevant.
(By 'relevant' I mean that a high percentage of users have found the ad that appears for their search relevant enough to click on - which of course translates to CTR.)
It is worth remembering the ad relevance - as measured by CTR, and as defined by our users, is 50% of the equation that determines position, moment to moment. The other 50% is Advertiser A's Max CPC as compared to Advertisers B's Max CPC.
The formula is pretty straightforward: CTR x Max CPC = Rank Number. The higher the rank number, the higher the position.
AWA
I think the bottom line on this is Google always shows the ads that are likely to generate the most revenue for Google at that point in time when the search is performed.
From AdWordsAdvisor
It is worth remembering the ad relevance - as measured by CTR, and as defined by our users, is 50% of the equation that determines position, moment to moment. The other 50% is Advertiser A's Max CPC as compared to Advertisers B's Max CPC.The formula is pretty straightforward: CTR x Max CPC = Rank Number. The higher the rank number, the higher the position.
You're talking the same thing: EPM
Rank Number is EPM equivalent (Earnings per 100 or 1000 impressions which one you prefer).
This is where the difference between AdWords and Overture exists. AdWords = EPM whereas Overture = CPC.
You may argue that Google may not show the ad which generates the most revenue all the time. This is true in some cases where the actual CPC is far below the Max CPC. However, this feature is designed and intended for blindly bidding war to pump up its revenue.
