The lower limit on position preference is a hard limit, but the upper limit is
not. The system will try and hold to the upper limit defined in your
preferences, but we couldn’t make it a hard limit. In the unlikely scenario that
the ads that would normally compete for the top few positions all had upper
limits of position 4, for example, having that upper limit be a hard stop would
cause issues for the auction.
After going through the explanation, it just seems natural that upper limit can't be honoured. Had it been, then if too many people opted for 3-8 position would have most likely a blank page served, because either, nobody would qualify for the slot 1-2, and in such a scenario, system cannot show result 3-8. Hence, it is not a welcome situation.
People complain even though they are bidding higher and highest possible bid ($100), they cannot see their ad in the preferred position. A deeper diagnosis reveals.
- Chances of failing increases as you go down the order. So, you are more likely to succeed with position preference if you have chosen anything like 1-3, 1-4 etc,, but less likely if you have chosen 5-8, 4-6 etc.
- Keywords with high Quality score are more likely to get the preferred position compared to those with lower quality score.
- Increasing bid won't help you get the preferred slot. It might help only when you fail to meet the requisite ad rank for the slot. Preferred slot are not bid sensitive.
Why this happens? It is because you are not the only person who is opting for the preferred sslot say 5-8. In such a situation say, there are 6 advertisers opting for slot 5-8, which has space for only 4. In such a scenario top 4 QS holders would be ranked according to the adrank in the slot 5-8 and rest two would be pushed up higher, provided they meet the ad rank qualification for the slot they are pushed into.
So, to get the preferred position, you should always check if you are having good QS too for the keyword, for which you are enabling position preference.
Note: The above post is a hypothesis and is based on some experiences with position preferences.