Michael Gray

Adwords Pricing - Things That Make You Go Hmm…

Posted on September 12th, 2006
by Michael Gray in Advertising, Google, SEM



So I’m bidding on a keyword where I’m the only person running an ad. It’s getting between 1,000 and 1,500 searches a day and getting between a 3-4% CTR. I’m a little baffled how they come up with the $0.12 a click figure since there’s no one under me.

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9 Responses to “Adwords Pricing - Things That Make You Go Hmm…”

  1. User Gravatarquadszilla Says:

    I love when i get paid 2 cents on an SEO related search. Does that mean I can buy traffic like that for 4 cents a visitor? Where do I sign up?!?

  2. User Gravatartony rocks Says:

    Mike,
    I think they take into consideration that at any given moment, somebody may get under you. Wait…that didn’t come out right.

    Are you Arbritragin’ for this? Just curious.

  3. User GravatarMichael Gray Says:

    no arbitrage selling a product. I also have the #2 organic listing for the keyword as well which coverts 3 times better than the PPC landing page.

  4. User GravatarG Says:

    “I also have the #2 organic listing for the keyword as well which coverts 3 times better than the PPC landing page.”

    Just curious, if the organic landing page is 3 times better on CR, how come you don’t point your PPC traffic over there?

  5. User GravatarMichael Gray Says:

    I do, but I’m able to track organic conversions separately from paid conversions.

  6. User GravatarQuality Nonsense Says:

    I regularly have the same experience. However, I’ve found that the CPC tends to fall over time as your keywords and ads get a little history re: quality scores.

    From the Inside AdWords blog:

    The minimum bid is 100% determined by the Quality Score. Just like the auction, the minimum bid for your keyword is dynamic, and specific to your keyword in your specific Ad Group…. The higher the Quality Score for your keyword, the lower the minimum bid.

    Microsoft’s AdCenter behaves the same way.

  7. User GravatarJamie Says:

    What tool do you use to track conversions?

  8. User GravatarMichael Gray Says:

    You really are at the mercy of the merchant or affiliate network. Strangely the smaller guys with less resources provide better tracking, go figure …

  9. User GravatarLea Says:

    I still say that Google uses a random number generator to determine the prices. I sit here and watch the prices people pay, and the prices I am paying (no, I’m not arbitraging - different markets) and can see neither rhyme nor reason in it.

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