How Google AdWords Ranks Search Ads


If you’re getting started on understanding Google AdWords then you’re probably wondering how it ranks the ads. It’s a great question and needs a detailed explanation. For starters bidding high enough on a keyword does not guarantee a high placement on search results. The bid price is one of many elements that are factored when determining the display order. This means simply having the budget to spend isn’t going to guarantee the traffic and/or visibility you’re seeking. When it comes to paid search engine ranking, it’s all about ad relevancy.

AdWords is based on an auction pricing system. So, the advertiser bids on a price point for a range of rankings for a particular keyword. For example, for the keyword “Arizona Vacation” the price range could be $0.45-$0.55 for placement on slots 1-2, $0.25-$0.45 for placement within 3-7, etc. Hence to be considered for the first two rankings you would have to bid at least $0.45 for that particular keyword. The story doesn’t end there, however.

In order to deliver the search user a better experience, Google has implemented a quality score. The quality score guards against irrelevant search results on keywords by evaluating the relevancy of the ad under consideration for a given keyword. The final ranking on a paid search is then the quality score times the bid price. (Ranking = Quality Score x Bid Price.)

Google does not disclose all that is involved in the calculation of the quality score, but it does state that consideration is given to the relevancy of the text in the advertisement and the click-through rate of the advertisement, as well as the relevancy of the landing page, etc. As you can see, the goal is to drive relevant ads for keywords for the best possible user experience. After all, a poor user experience will result in loss of credibility in the search engine. It is also beneficial for the advertiser, since this system helps to create relevant traffic.

So really in order to boost your ranking on paid search you need to make sure you have an adequate budget but you also need to make sure your ad copy and your destination website is relevant to the words you are bidding on. At the end of the day it’s all about relevancy and the user experience. Google wouldn’t be Google if it didn’t deliver a relevant search result for each query.  So, if you want to boost your position focus on improving your quality score and then up your bid a bid. If you do it right you’ll be surprised at the results.

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