If I pay 10c for the phrase “working in America†and that is the highest amount paid for that phrase will some one spending 20c for “working†outrank me because my phrase contains their word?
If they don't have "America" as a negative keyword I think there is a chance. I have had a single keyword rank high in Google for my keyword plus an additional word I was not bidding on.
Yup, they will. Thats why you may have the the top bid for a long trail keyword but someone who has just one word in that keyword and has a higher ranking will go over your ad. So pretty much if "working" is $1 a click, you'll have to outbid them on "working" for it to show.
It's not quite that simple. Your bids are multiplied by your Ranking Quality Score in order to determine a kind of 'virtual' bid. This is what is used to determine your position in the results. There a lots of things that impact your Ranking Quality Score, such as clickthrough rate, advert text relevance and keyword match type. You'll get an advantage by bidding on the keyword on exact match. You'll also get an advantage if you include "working in America" in the advert text (which he probably can't). Finally, your advert text can be more targetted to what the searcher is looking for (for example, you can extol the virtues of the US of A - I've heard that the coffee's nice). Whether all of these are sufficient to overcome his bids being twice as high as yours is anyone's guess, but if you write a good advert, you should be able to bid less than him and still appear above him. Here's an example of how the RQS works: http://www.epiphanysolutions.co.uk/...quality-score-to-decide-your-adverts-position
Nice info CustardMite. I notice changes quite often on the ranking and bid prices in my adwords account. There are a couple keywords that I rank number one for and I am only spending 2 cents per click while beating out 5 other advertisers and generating 35% CTR. But othertimes I pay dollars per click and can't get much better than 1% CTR.