How much of a difference will being in the first position, as opposed to the second, third or sixth position make, for your net profit? The answer is that it depends on your creative, industry and who else is bidding on your keywords. The bottom line is that you should know. Test your ads in each position and work out where it will be most effective, from an ROI point of view.
Remember also that the adwords ranking algo works on a CPCxCTR basis (it’s actually more complicated than that, but that gives an idea as to why out of two ads with similar CPC’s, one will be higher because of a higher CTR).
You will be surprised to see that sometimes position #2 or #3 will be more profitable than position #1. I was doing a test campaign in the niche of a web hosting. I was at #1 for like 3 months and my ROI was approximatly 2% which means each 100 visits I get from Google Adwords 2 people will buy the service that I was promoting.
Also let me mention that I was splitting ads and landing pages. When I reduce my bids and lowered my position to #3, my traffic was converting up to 5%. So this may surprise you if you test different positions with your best converting landing pages and ads.
