PPC_Chris - 5:28 pm on Nov 10, 2008 (gmt 0)

Yahoo's system for minimum bids is sucking away at everyone's profit margin. For a whole ton of my keywords, minimum bids are between 1% and 10% higher than my actual bids. So I see things like:

current bid: $0.74
new minimum bid: $0.80

All over my account its like this. Then if you increase your bid, a month later, the new minimum bid goes up another 5%. Well, at $0.74 Yahoo is already taking about 80% of my margin (per click). As these minimums go up, it gets closer and closer to the level where its just not worth advetisers time or effort to keep these campaigns going. Over the past year or so, low quality partners and minimum bids have combined to turn many of my campaigns unprofitable so the only recourse is to shut them down. Its only a matter of time before the advertisers who are not tracking as thoroughly as many of us are realize that are losing money and stop their campaigns as well. When this happens, Yahoo is screwed.

Not too say that you shouldn't test Yahoo as my biggest campaigns are doing very well. But I fear that soon, Yahoo will figure out a way to try squeeze every nickel from me that I am making on these products too until its no longer worth it to advertise there at all.