The Highest Paying AdSense Ads May Not Always Be On Top

If there are multiple Google AdSense ad units on a web page, it is generally assumed that the top ad unit (the one which appears first in the HTML source code) will serve the highest paying CPC ads. Well, that may be true most of the times but not always. Let’s understand why.

But before you dive into the example below, please watch this excellent video by Dr Hal Varian, Chief Economist at Google, as he explains how an ad auction works and what factors determine the position of AdSense ads on a web page for a given keyword.

The Google AdWords system assigns a "Quality Score" to every advertiser who is participating in the ad auction and this score is determined by the quality of the advertiser’s website, the historical CTR of his ads on Google and a couple of other factors.

For instance, the Google ad system is likely to assign higher Quality Scores to Sony.com or Amazon.com for the keyword "digital cameras" than an advertiser xyz.com who is trying to promote his eBay auction on the AdSense network.

Google than computes the final rank (or ad position) of each advertiser using their respective quality scores and the maximum amount they are willing to pay for a single click (CPC).