Yahoo is implementing a new ranking model for the U.S. that will take an ad’s quality and the bid amount into consideration.

“This new model is designed to help you spend less time in bidding wars and more time creating the most relevant, effective ads, which can help drive better results for your business,” according to recently released information by Yahoo’s Search marketing.

Yahoo’s move clearly follows the current Google Ad-Words Strategy of providing quality over the bid price. In other words, the advertiser paying top dollar for the ad may not have the highest ad placement on a web page. Ad placement is determined by the quality of an ad. Google has been using this quality/bid price model for some time, and is leading the way in Search Engine advertising

What determines an ad’s quality?

Quality is determined by the number of hits and how long a potential client visits the linked site. In other words, quality is determined by an ad’s historical performance – its click-through-rate in relationship to competitive ads. Yahoo is also implementing a second quality measure, using various relevance factors created by Yahoo’s ranking algorithms.

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For more information on Yahoo Search Marketing, you can view their site at http://help.yahoo.com/l/us/yahoo/ysm/sps/start/overview_newadrank.html