February 2002 will always be remembered as the time when google forever changed pay-per-click advertising.Google launched Adwords select, which incorporated all of Goto.com's founding principles; however,in typical google fashion,they added their own twist to the auction model.
On Goto.com, the more you paid,the higher your ad appeared in search results. that essentially made it so the company willing to pay the most had the highest visibility.Google's main advertising word was relevance, and they changed the ppc auction model to both increase relevance,and they changed the ppc auction model to both increase relevance for a searcher and to maximize how much money google made on a search results page.
Their twist was to incorporate click-through rates(ctr) in determining where an ad showed up in the results. they used a very simple formula to determine ad position:maximum cpc(cost per click) multiplied by CTR
On Goto.com, the more you paid,the higher your ad appeared in search results. that essentially made it so the company willing to pay the most had the highest visibility.Google's main advertising word was relevance, and they changed the ppc auction model to both increase relevance,and they changed the ppc auction model to both increase relevance for a searcher and to maximize how much money google made on a search results page.
Their twist was to incorporate click-through rates(ctr) in determining where an ad showed up in the results. they used a very simple formula to determine ad position:maximum cpc(cost per click) multiplied by CTR
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