Paid Search: What influences impression share and CTR?

Because search engines only earn revenue when an ad is clicked on, algorithms favor ads getting the most clicks (highest CTRs). Upfront, without any historical delivery stats, ads will be treated equally until the algorithms learn the conversion rate.

At the base level, impression share is determined by basic supply (search volume) and demand (competition). The more competitive an intended audience is, the more budget that is required for a decent share.

CTR is performative based. Which ads are being clicked on more often, and why? It could be that the ad copy is more compelling. Many times, it has to do with which brand is more recognizable, which is why brand awareness is important in search success.

Ads with higher CTR are going to get better impression share, even if their total bid or budget is lower, because search engines only earn revenue from clicks. An advertiser with strong brand recognition and a compelling, relatable message could receive higher impression share at a lower cost per click.