In many pay-per-click systems the only determining factor in ad placement is the maximum bid price. In those systems, if you are willing to pay more than a competitor then your ad will be placed above theirs. Google AdWords does not work that way and places your ad based on performance.

One of the criteria used by AdWords to determine the placement and cost of advertisements is the historical Click Through Rate (CTR). CTR is determined by how often your ads are clicked in relation to how often they are shown. Ads with a higher CTR get higher placement and a lower ad cost.

AdWords keeps a historical record of your individual keywords, phrases, and groups beginning the first time that you begin using the system. This can be a challenge for new internet marketers.

When you open your Google AdWords account you will have an absolute ZERO historical click through rate. The competition that has been using AdWords is leaps and bounds ahead of you and will be getting prime ad placement while you are at the bottom of the totem pole. Most people only look through the first page or 2 of a search and if your ad is on page 3 they will not see it. This might seem like a ?lose-lose? situation, but don't worry, we are going to show you how to turn that around.

Keyword Macros

Keyword macros are a feature of Google AdWords that allow you to create dynamic ad copy. This feature allows your ad to display the user's exact search phrase as your ad headline.

To use the Keyword Macro feature all that is needed is a little syntax:

{KeyWord:alternate headline}

Using this syntax in your AdWords campaign will display the user's search as your headline. Google AdWords allows only 25 characters as a headline however and if the search exceeds this limit your alternate headline will be displayed.

If you notice in the syntax above the K and W are in capital letters. Doing this will cause the user's search to not only become your headline but the first letter of each word will be capitalized. This will make your ad stand out from those who do not use this macro.

Finally, using this macro will cause your headline to be shown in bold type, yet another way to make your ad stand out from the rest.

How does all of this help build a historical CTR? Using keyword macros will result in much higher click through rates than standard headlines. This is the fastest way to build historical CTR. If you keep your CTR high your ad will enjoy better placement and you will enjoy lower ad costs.