How exactly does the Google quality score determine the CPC I pay? If I have the highest quality score I am placed in the #1 position, yet I could still have a lower max CPC than the advertiser with the 2nd highest quality score, so how is my actual CPC determined? Could anyone give an example?
Quality Score = (keyword's CTR, ad text relevance, keyword relevance, landing page relevance)*
*Where the interactions between the Quality Score variables change as Google continues to refine how to measure and define quality in AdWords.
Ad Rank = CPC X QS
So for example -
Max CPC 50p & QS of 5 = Ad rank of 2.5
Max CPC 1.10 & QS of 2 = Ad rank of 2.2
Obviously the top one with 2.5 would rank higher than the 2.2...
Actual CPC = Ad rank of below advertiser / Your Quality Score + 0.1p
The actual cost per click calculation is determined by the ad rank of the advertiser directly below you, divided by your own Quality Score + 1p.
So in the isolated example above...
2.2 / 5 = 0.44 +1p = 45p a click actual cpc.
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