Ad Position Formula — How to Measure the Ad Success on SERP

A lot of marketers are making a big mistake with their PPC advertising. You might be one of them. The Google Ads ad position has been held in high regard by many people, with companies operating under the belief that it is a cornerstone of advertising success.

Ad Position formula takes gives your ad a score based on your bid, the quality of your ads and landing page, the Ad Rank thresholds, the context of the person’s search, and the expected impact of extensions (promotion extensions) and other ad formats and then calculated the ad position for your advertisement.

They’ve judged performance on this metric, based key decisions on it, and allowed their campaigns to be guided by it.

But here’s the truth:

They’ve all been duped. The Google Ads ad position metric isn’t that important. At best, it’s misleading, and at worst, it’s an illusion that may cause you to make some poor decisions in your advertising campaign.

In this article, we’ll reveal the reality of this metric, and let you know the best way to accurately gauge the true performance of your ads.

What is Google Ads Position?

The order in which your Google Ads appear on a page in relation to other ads. For example, an ad position of “1” means that your ad has the highest position on the page relative to other ads of the same type. It doesn’t necessarily mean that your ad is above the search results. If there are no ads above the search results, then it means that your ad is the first ad shown beneath search results.

Your Ad Rank is recalculated each time your ad is eligible to appear, so your ad position can fluctuate each time depending on the context of the person’s search and the competition among other advertisers at the precise moment of the person’s search.

How reliable is the Google Ads Position Formula?

Everyone wants a higher Google Ads position because it’s more likely to yield a higher Google Ads CTR. However, the quest for the number one spot on every keyword can be a costly venture.

This is because most people don’t realize something about Ad Position. The following metrics are useful in understanding the ad position in Google Ads.

On the Search Network, if you want to understand the location of your ads on the search engine result pages (SERPs), you can use the top and absolute top impression rate metrics “Impr. (Abs.Top) %” and “Impr. (Top) %.”

If you want to bid on page location, you can use the top and absolute top impression share metrics “Search abs. top IS” and “Search top IS”. To do this, you can use the Target Impression Share bid strategy with the option to target the top or absolute top of the page.

• The top impression rate is the percentage of your total impressions that are coming from the top of the SERP.

Top impression rate = Top impressions / Total impressions

• The absolute top impression rate is the percentage of your total impressions that are coming from the very top of the SERP.

Absolute top impression rate = Absolute top impressions / Total impressions

• Top impression share is the rate at which you’re turning opportunities to appear at the top of the SERP into actual impressions at the top of the SERP.

Top impression share = Top impressions / Eligible top impressions

• Absolute top impression share is the rate at which you’re turning opportunities to appear at the very top of the SERP into actual impressions at the very top of the SERP.

Absolute top impression share = Absolute top impressions / Eligible absolute top impressions

The success of Ad Position is When it Gets Impressions:

Ad position is heavily influenced by impression share. So, if your keywords are generating a 100% impression share, then the ad position will be a great barometer to measure performance on. But realistically, your impression share won’t be 100%. It might not even be close to that, and that is where a lot of marketers are misled by the Google Ads ad position metric.

Consider this example:

Here’s a simplified example of how Ad Rank works. It doesn’t account for all of the factors discussed above, but instead aims to give you a high-level overview of algorithms:

Assume five advertisers are competing for a maximum of four ad positions above search results on the Google search results page. The respective Ad Rank of each of the advertisers is, say, 80, 50, 30, 10, and 5.

If the minimum Ad Rank necessary to show above the search results is, say, 40, only the first two advertisers (with Ad Ranks of 80 and 50) exceed the minimum and show above the search results.

If the minimum Ad Rank necessary to show below the search results is 8, then two of the three remaining advertisers (with Ad Ranks of 30 and 10) will show beneath the search results. The advertiser with an Ad Rank of 5 didn’t meet the minimum Ad Rank and so won’t show at all.

The Two Metrics that Really Matter in PPC Advertising

It’s important to know how your ads are performing. Normally, if they are appearing in the top three positions, then it’s a good sign. However, rather than judging that by the Google Ads ad position metric, here are a couple of other methods you can use to keep a close eye on ad performance.

• Click-Through Rate (CTR)

With a higher position, your ads will get more clicks because more viewers will see them. Your CTR can be 10x or 15x higher when your ads appear in the top spots, or in the banner positions. That’s a traffic boost of up to high numbers. By tracking the CTR on your ads and relating them to the ad position metric, you can see if the clicks are aligned with your expectations.

• Top Vs. Other

This segment in Google Ads displays performance data for your ads based on the position in search engine results. Using this allows you to view two distinct data sets:

• Top — This displays data for when your ad was at the top of the page (i.e. positions 1, 2, 3, and 4). This is when it appeared before all non-paid, organic listings.
• Other — Position for when your ad was further down the page (i.e. positions 5 and higher), after the organic results.

You are able to view this breakdown at all levels, from campaign and ad group to the keyword level. This makes it easy to compare the time your ad spent in the top position against all other positions. Ultimately, this is the best way to gauge the true performance of your keywords, and it effectively fills in the gaps that the Google Ads ad position metric leaves.

Better Ads always lead to better ad position and Ad rank:

Whenever someone does a search that triggers an ad that competes in an auction, Google calculates an Ad Rank. This calculation incorporates your bid and auction-time measurements of expected CTR, ad relevance, and landing page experience, among other factors. To determine the auction-time quality components, we look at a number of different factors. By improving the following factors you can help improve the quality components of your Ad Rank:

• Expected Clickthrough Rate: eCTR is partly based on your ad’s historical clicks and impressions (adjusting for factors such as ad position, extensions, and other formats that may have affected the visibility of an ad that someone previously clicked)
• Ad relevance and search term: How relevant your ad is to what a person searches for
• Landing page: A good landing page is also important, how relevant, transparent, and easy-to-navigate your page is. Your focus is not only to bring traffic on the website but the actual services you want to offer through your website.

Wrap Up:

Ad position always tells you how reliable and effective ads are going, quality ads always lead to lower cost, better ad position, and more advertising success.