When dealing with Google Adwords, it is important to understand where exactly your ad is going to be placed on the page and why. Google is constantly changing their algorithm for organic seo, but for paid advertisements, their system is a little simpler.
The first characteristic of your ad campaign that Google evaluates is the amount that you are willing to pay “Per Click”. In other words, how much you are willing to pay Google for every person that clicks on your ad and continues to your website. The more you are willing to pay for the ad, the higher your ad will rank on the search page.
The second aspect of your campaign that google evaluates is the quality of your existing site and SEO material, your quality score. All of the hard work a company puts in to its natural ascension on the search page also plays a part in the effectiveness of their paid ads. The higher quality score from Google, the higher your paid ad will be on a result page.
So if you multiply the amount, in Dollars, that a company is willing to pay for their ad, per click, and the quality score assigned to company from Google, this will result in your Adwords campaign ranking. Now, depending on other companies competing for the same results page, or the same keywords, this score will determine your place on the page. For instance, if your company is willing to pay $2 per click and have a quality score of 4 (2×4=8) and your competitor receives a 6 from this equation, then your company will be ranked higher than the competition.
I like that you talked about the quality score. This is something I forget about and was a great reminder.
Great explanation of SEO/SEM and ad buying. I think you explained it well for someone who isn’t taking these classes. Often blogs over-explain or try to take on too much and it gets complicated.