Does price of keyword have anything to do with how much you make when its clicked????

Discussion in 'Pay Per Click Advertising' started by oneeezy, Aug 15, 2008.

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  1. #1
    Hey guys, lets say i have a "golf website" for example.. say I'm using google adwords on my website to make money and the keywords are:

    Golf (bid $.80 per click)
    Playing Golf (bid $.40 per click)
    Golf Ball (bid $.25 per click)

    Now with that knowledge, say someone goes to my golf website and decides to click on my google adwords ad that generated because of the word "golf" which has a bid of $.80 .. I'd be making the most money on that one right and the least amount of money with "golf ball" right????

    Do I have the right idea about this or am i just completely wrong? hah'..

    Thanks,
    Justin O'Neill

    AIM: Jdude217
     
    oneeezy, Aug 15, 2008 IP
  2. squarecat

    squarecat Peon

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    #2
    Hi Justin,

    Generally, as AdWords is an auction based system, the bid price is dictated by the advertisers so you will see higher bid prices in areas that have high profit margins and lower ones in those that have less. For example there may not be many people willing bid very high on the term "golf Balls" as they have a lower margin than, say, "golf clubs" which would have a higher bid price.

    This trend is seen across most sectors with some areas having very high bid prices to be on the first page - mortgages & certain legal searches have CPC prices above £10-15 as they are high margin areas.

    So in summary the premise is correct - the money money that can be made then generally the higher the competition and hence higher the bid price.

    Hope this helps
    Ben
    Snr Account Manager
    Attacat - ppc specialists
     
    squarecat, Aug 15, 2008 IP
  3. 2-4-K

    2-4-K Peon

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    #3
    Heres the things you need to realise also..

    1. The keyword bid prices are ONLY indicative as the advertiser on position 1 may not be paying the maximum amount due to a good quality score.

    2. Adsense advertisers are only paying for bid prices on the 'content network' therefore the bid prices are quite alot cheaper tha on the search network. Also in the content network advertisers can also select CPM (cost per thousand ads displayed) instead of CPC.. So a bid price might be as low as $0.50 / thousand ads displayed on your golf site so each click in that case would be worth as low as a fraction of a penny.

    3. Google pays generally around 50% split with advertisers in Adsense program
     
    2-4-K, Aug 18, 2008 IP