Step-4:The Ranking Algorithm-CTR & QS.
What is CTR:
CTR or Click Through Rate is the number of clicks your ad gets for every 100 display of your ad. The more your CTR ; the less you have to pay for each click from your bid amount. For example if your bid is $0.30 and your ad have a CTR rate of 50% ; you'll be charged half of your bid for every click ie $0.15 . So , higher CTR is important. If you follow my rules and formulas for writing ad body and ad title then you'll definitely have a very good CTR rate. [say atleast 40%]
What Is Quality Score:
Quality score is the product of CTR and bid for evry click.The more your quality score better you'll be ranked. For example-
Ad-A:
CTR=35%
bid or PPC=$0.20
Q.S=35 * 0.20=7
Ad-B:
CTR=40%
bid or PPC=$0.20
Q.S=35 * 0.20=8
Since Ad-B has more Quality Score -it'll rank better. Better ranking is importttant.