AdSense today released a video explaining how its system goes about determining which ads to display on your creatives...
You can also read their accompanying blog post here...
Insight into your earnings Part I: Explaining the ad auction - Inside AdSense
This video explains how AdWords' "Quality Score" plays a significant role in determining which ads gets displayed on your website. In the video, they also explain that the number of clicks a particular ads gets on your website is factored into the Quality Score.
This basically confirms what I reported in two earlier blog posts, "How Quality Score Affects AdSense", and "Quality Score Rankings for AdSense".
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