The ranking is showing how well the alliance fights together, how good of opponents it has defeated. Meaning the top alliance is the hardest to win a match against.
ELO is based on alliance matches, and winning or losing a match likewise wins of loses ELO points, however, you win or lose based on the ELO of yourself and your enemy. This means a top Alliance taking out the lowest ELO alliance will only get a couple of points transferred from the low ranked loser to the high ranked victor; while if a low-ranked alliance takes down a top alliance, the point transfer will instead be huge.
