hi, I come across this question when I was studying adwords... If competitor X bid X.XX ...and assuming that their CTR/Quality Score is the same...how much does the competitors actually pay? Position 1 : Competitor 1 : bid$1:00 Pay 0.81 ? Position 2 :Competitor 2 : bid$0:80 Pay 0.61 ? Position 3 :Competitor 3 : bid $0:60 Pay 0.21 ? Position 4 :Competitor 4 : bid $0:20 Pay 0.11 ? Position 5 : Competitor 5 : bid $0:10 ....... It is safe to say it would be always you will pay 1 cent higher than your lower postition competitor's bids and not 1 cent higher for what your competitors pay? So in this case, the competitor 3 actually pay 1/3 of the competitor 2 to get the third position? However, if the positon of competitor 1 and 2 change due to CRT/Quality Score, are these how much they are paying? Position 1 :Competitor 2 : bid$0:80 Pay 0.80 ? or remain as 0.61 Position 2 : Competitor 1 : bid$1:00 Pay 0.61 ? or remain as 0.81 Position 3 :Competitor 3 : bid $0:60 Pay 0.21 ? Position 4 :Competitor 4 : bid $0:20 Pay 0.11 ? Position 5 : Competitor 5 : bid $0:10 ....... Sorry, quite new to adwords, just want to sort out my confusion
If as you say QS was all equal between advertisers, then it would simply be a case of paying 1p (or cent) higher than the advertiser below. Actual CPC = Ad rank of below advertiser divided by your QS + 1p (cent). The Ad rank formula is CPC X QS. So you would need to know your own QS and that of the advertiser below to really work this out. Suffice to say, thats how advertisers can pay less per click to rank higher.
Hi, sorry i still can't get it, can you show me the actually amount they are paying based on the 2nd scenario?
Try reading this: http://www.epiphanysolutions.co.uk/...your-adverts-position-and-why-it-matters.html It's a blog I wrote explaining exactly how this works, and how even a small improvement in your quality score can save you money...