AdSense and Quality Score

Google is in a race to continue to be relevant to advertisers, publishers, and searchers.

They have wonderful opponents, SPAMMERS. Individuals trying to make money by “Gaming” Google. These SPAMMERS are always a few inches faster.
The first step was for Google to increase ad prices to the advertisers by introducing a new metric when buying keywords. Calling it “Quality Score” a metric on landing pages to determine relevance.
No on page relevance equals higher keyword click prices for the advertisers.

This increased the cost per click for many of the advertisers which increased Google’s profit, but increased relevance to the searchers.
This was just the first step.

Next, they added “Quality Score” to the pages of where the ads are placed in non-google properties, A.K.A. Publisher sites.

This will decrease Google’s revenue, but increase relevance to the advertisers.

Thus, creating more relevance to everyone (-SPAMMERS) and producing similar revenues as before.

Google’s Quality Score
Definition: Quality Score is the basis for measuring the quality and relevance of your ads and determining your minimum CPC bid for Google and the search network. This score is determined by your keyword’s clickthrough rate (CTR) on Google, and the relevance of your ad text, keyword, and landing page.

We believe high quality ads attract more clicks, encourage user trust, and result in better long-term performance. To encourage relevant and successful ads within AdWords, our system defines a Quality Score to set your keyword status, minimum CPC bid, and ad rank for the ad auction.

Sources: Google Revises AdSense Formula