The particular keyword I'm bidding on has become saturated to the point where no one can make a profit thanks to idiots bidding so high that they are making a loss. Obviously, it's insane to try and rank 1st, even with 10 out of 10 relevancy score. I just wondered if anyone else has had the same predicament. If so, how did you get around it?
The problem with idiots is, even IF they realize they are losing money and quit, there's always another idiot behind him to take his place. However, you don't know how much they are bidding and more important, how much they are actually paying. They may not be losing money. Maybe they are in the short term but not in the long term. Suppose the top two advertisers both have QS=10, the first one bids $2 and the second one $1.80, the first one will pay $0.90 on his clicks. What the second one pays will depend on the QS and bid of the advertiser in third place. If the first one bids $2.50, his actual spend (with same second place advertiser bidding $1.80) will be $0.72. But at his original $2 bid and the second place guy bidding $2.25, the first place advertiser would pay $1.25. My advice is not to get into bidding wars. Let the idiots be the idiots. Bid what you can afford and make the profit you want. Concentrate on improving your ads. If you do and are patient, you may inch closer and closer to that top position.
Are you sure it's really saturated?I think maybe you should make a budget on it.Even the rank will cost you a lot, there may be still some profit for you.Or if you are sure about this,you'd better wait till the competition is lower. The market will not continue to become mad.It has a limit,I believe.Well,good luck.