As a web marketer, it is important to know the answers to the following questions: How do search engines determine what ads to show when? And to what degree can they calculate which advertiser is more relevant than others? Each engine has an algorithm developed that sorts out which ad to show, when to and where on the result page to show it, and how much to charge the advertiser.
Depending on the search engine, many known factors determine relevancy, along with several unknown factors. Most search engines use the following known factors to determine relevancy:
Keyword list: Do the keywords in the keyword list match what the person typed?
Ad copy: Does the ad mention what the person is looking for?
Landing page: Does the ad go to a page that has what the person is looking for?
Bid: How much are you willing to pay to get that visitor?
The amount of your bid in conjunction with these other factors determines where on the page your ad will display and how much you’ll actually pay.
For a complete list of known factors for a specific search engine, consult the search engine’s help center.
Search engines keep some relevancy criteria unknown to the public to keep the playing field level for all advertisers and to preserve a good user experience. This system cuts down on false advertising and misleading, spam-type ads; it also rewards advertisers who are adhering to the rules and editorial guidelines of the search engine.
