Patent ID: 8527339

Claim:
A method for selecting and determining per-click prices for online advertisements via an automated auction, comprising steps for: using a computing device for: receiving one or more advertiser bids and one or more corresponding advertisements from each of a plurality of advertisers; receiving statistical information characterizing behavior of a plurality of users with respect to each advertisement, wherein the statistical information for each advertisement includes an ad click count that indicates a number of times an ad landing page is reached by clicking the advertisement on a search results page of a search engine, and a redirect count that indicates a number of times a URL redirect is used to change a domain of the ad landing page to a different domain following clicking the advertisement on the search results page of a search engine; computing a quality factor for each advertisement as a function of the statistical information by dividing the ad click count by a sum of the redirect count and the ad click count; computing a payment probability for each advertisement as a function of the statistical information; sorting the advertisements in decreasing order of an effective bid that is a function of the quality factor, the payment probability, and the advertiser bid; selecting a number of the top sorted advertisements for display in a corresponding number of available ad slots, wherein the ad slots have a range of most desirable to least desirable, and wherein the selected advertisements are assigned to the ad slots in direct order of sort and desirability, so that the top sorted advertisement is assigned to the most desirable ad slot; and computing a price for each selected ad.