New Ranking Model Launches
We're excited to announce that the new ranking model has launched today, February 5, 2007, in our U.S. market. The new ranking model is designed to improve user results through higher quality search ads. When users engage with these higher quality search ads, advertisers will receive more interested, valuable potential customers, helping to drive better results for your business.

As we previously announced, both bid amount and ad quality
now determine an ad's rank in search results.
Your bid is the maximum amount that you're willing to pay when your ad is clicked. You will never be charged more than this amount.

Your ad's quality is determined by:

• The ad's historical performance—determined by its click-through rate relative to its position on the page.
  
• The ad's expected performance, relative to competing ads displayed at the same time—determined by various relevance factors considered by Yahoo!'s ranking algorithms.
  

You can gain an understanding of an ad's quality by looking at its quality index.

Example of How Ads may be Ranked
The graphic below helps illustrate a scenario that may result from this change:


Learn more about the new ranking model. Learn more about the quality index.

Five Things to do to Take Advantage of the New Ranking Model
To take advantage of the new ranking model, you should:

• Include keywords in your ads (use our Insert Keyword feature).
  
• Choose keywords for each ad group carefully.
  
• Use ad testing.
  
• Use Excluded Words to optimize your Advanced match type ads.
  
• Review your current bids and set a campaign budget to meet your business goals.
  

For more details, please click here.

Important Note on Forecasting
Starting today, February 5, with the roll-out of the new ranking model, we will offer several tools to use in making bidding decisions. However, there will be a seven- to ten-day transition period during which the "Estimated Clicks per Bid" forecasting tool will begin to accumulate data from the new ranking model in order to provide more recent historical traffic estimates. After these seven to ten days, you can have greater confidence in using this tool. In the meantime, we recommend that you use the "Bid Range for Top Positions" information to help guide your bidding decisions.

Learn more about the forecasting tools.