How can you tell which Ad Position is best?

A common assumption about paid search is that position #1 is the ultimate goal. Advertisers clamber over each other to ensure their ads make it into the top position, because they think that’s what’s necessary to be successful for their campaigns.

The profitability of a Google Ads campaign has four important factors at play:

• value of conversion
• advertising volume
• advertising cost
• internal cost

How do Google Ads positions affect profits?

To determine which Google AdWords position is best for profitability, we need to consider the relationships between all four factors mentioned above.

Ad position is reported in Google Ads from 1.0 (being the top of the paid listings section within the search engine results page) down to 7.0 and is reported as a decimal when averaged out. In the simplest example, if an ad shows up in position 1.0 once and then in position 2.0 once, it’ll be reported as “Avg. pos = 1.5”.

Why you shouldn’t sweat CTR too much

Countless studies regularly put out CTR benchmarks and compare metrics across different platforms and ad formats, so it must really matter right?

Eh…

Honestly, most of those benchmarks aren’t very useful. The main reason is that such studies are rarely conducted rigorously enough to account for major variables like device, brand vs. non-brand, google.com vs. search partners, changing SERP layout and other important considerations.

Directional same-site trends can be instructive for how things should be moving over time, but analyzing such trends well requires accounting for all of the same variables and typically isn’t very actionable.

Why number 1 doesn’t always mean higher Google Ads conversion rates

Arguably the most important element of the profit equation listed at the top of this article is the number of conversions we achieve.

Does conversion rate differ with ad position? A question that many paid advertising professionals wonder, and the answer, unfortunately, isn’t clear-cut.

Position 1 will encourage more irrelevant traffic

Naturally, being in position 1 will incur many costs from users who will click your ad simply because it’s in the top position. Rather than consuming the contents of your advert and making an informed decision as to whether or not the advert is actually relevant to them.

An increase in irrelevant traffic basically translates to a lower conversion rate since that very traffic would likely bounce off your website.

Short conclusion

Ultimately, it comes down to maintaining and hopefully growing your profitability. You don’t want to bid too much, to the point where your ROI is being negatively affected.

Only you know where that line is though. It’s important to play around with positioning. If your ads are in a position that is providing profitability, but you still have some budget to spare, try increasing your bids a bit to land in a higher position.