Why does advertisers bid a lot for some keywords?

Discussion in 'Pay Per Click Advertising' started by FireStorM, Dec 25, 2005.

  1. #1
    i wanted to know why some advertisers bid a lot on some keywords , some bid very very little while some bid $5 , $10 and even more .. ]

    what is the reason behind this? Is this because there are many others bidding on the same keyword?( the high earning keywords)

    And also what do they get in return when they bid a lot on some keywords?

    i am new to adwords .. therefore wanted to understand this concept.

    According to me , my logic tells me that if a site is only targetting keywords which has only one or none Google Campaigns , this site will have very little revenue as advertisers are not bidding for this kw, am i right?

    if for the same keyword , someone bid $1 and others bid above $2 for this same KW , how will this be more useful for the ones who have bid above $2 ?
     
    FireStorM, Dec 25, 2005 IP
  2. ashiezai

    ashiezai Peon

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    #2
    they bid on the keywords because those keywords bring revenues :)
     
    ashiezai, Dec 25, 2005 IP
  3. ashiezai

    ashiezai Peon

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    #3
    Ofcos some keywords are more productive than others, so the price difference.
     
    ashiezai, Dec 25, 2005 IP
  4. FireStorM

    FireStorM Well-Known Member

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    #4
    if for the same keyword , someone bid $1 and others bid above $2, how will this be more useful for the ones who have bid above $2 ?
     
    FireStorM, Dec 25, 2005 IP
  5. Dakait

    Dakait Banned

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    #5
    Well.....getting revenue through PPC does not end with bidding.

    Getting revenue through PPC need

    1. Getting CTR from Ads. (Attractiveness of Title and Description in Ads)
    2. Convincing power of landing page.
    3. Convincing power of site as a whole.
    4. Degree of targetedness in keyword.
    5. Your credibility in market.

    and need Careful mathematics for calculating investment and production.

    If someone is at better position on above criteria than definatly...he will bid higher (more than $2 in your case).
     
    Dakait, Dec 25, 2005 IP
  6. sarathy

    sarathy Peon

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    #6
    Thatz because Bidding 10$ does not mean you would be charged 10$ for a click.

    They do that only to ensure that they have
    100% rotation for a particular keyphrase they are bidding on.

    Even then, There are various factors involved in it.,
    Your ad title and content
    Your CPC ration and many more factors

    I would also suggest that You should create campaign based on countries so you will have different charge for different clicks.

    Gives this site a look: it will help you to understand better: :)
    http://www.google.com/adwords/learningcenter/
     
    sarathy, Dec 25, 2005 IP
  7. dburdon

    dburdon Peon

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    #7
    Its mainly a function of demand times value. soem markets there are few bidders. Other markets a lot. A market with a lot of bidders will normally see its bid values rise.
     
    dburdon, Dec 26, 2005 IP
  8. Dakait

    Dakait Banned

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    #8
    I hope it is supposed that market is same here....as keyword (well researched by all bidders in same way) is same.
     
    Dakait, Dec 26, 2005 IP
  9. amitpatel_3001

    amitpatel_3001 Results Follow Patience

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    #9
    Its Based on What the ROI of the Advertiser Mainly.

    If he is Expecting more then he May BID more.
     
    amitpatel_3001, Dec 26, 2005 IP
  10. Dakait

    Dakait Banned

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  11. airforcematt

    airforcematt Active Member

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    #11
    Supply and demand is what it all burns down to.
     
    airforcematt, Dec 27, 2005 IP
  12. Dakait

    Dakait Banned

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    #12
    I agree.

    The point here is.....why some people invest more and some less in same demand level.

    The answer is -- some people have the skills to draw much more by investing little more. :)
     
    Dakait, Dec 27, 2005 IP