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Understanding the Google Ads Auction System
Google Ads operates on an auction-based system, where advertisers bid on keywords to display their ads in search results, YouTube, or display networks. However, the highest bidder doesn’t always win—Google considers:
- Max Bid: The maximum amount an advertiser is willing to pay per click.
- Quality Score: A metric (1-10) based on ad relevance, expected CTR (Click-Through Rate), and landing page experience.
- Ad Rank: Determines your ad’s position, calculated as Max Bid × Quality Score.
- Ad Extensions: Additional links, phone numbers, or information that improve visibility and CTR.
Why This Matters?
A high-quality ad with a lower bid can outrank a high-bid ad with poor relevance. Mastering Quality Score helps you get better placements at lower costs.