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Overture UK doubles minimum bid to 10 pence

Will they do this for Overture US too?

     
10:27 pm on Jan 28, 2003 (gmt 0)

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Just got the email a few minutes ago.
1:13 pm on Jan 29, 2003 (gmt 0)

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Hurlingham suggested that this might be an abuse of a monopoly. If so, the place to discuss it is at:

[oft.gov.uk...]

(That's the Office of Fair Trading)

2:13 pm on Jan 29, 2003 (gmt 0)

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It would be good if someone with a lot of knowledge of overture could talk to the OFT about this. It may be that there is no case to answer, but at least they might look at it.

I've only just started to use overture, so not me :-)

3:29 pm on Jan 29, 2003 (gmt 0)

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I use Overture US and I just noticed that they are charging me .10 per click minimum on my autobids. ie. I've bid .49 and my only competition is .05 and they are charging me .10 per click whereas last time I checked I was being charged .06 per click. I received no notification e-mail and the minimum bid listed on the web site is still .05. Nice. :(

I actually came here today to see if other people had noticed what was happening.

4:15 pm on Jan 29, 2003 (gmt 0)

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overture certainly does not have a monopoly of any sort.
4:35 pm on Jan 29, 2003 (gmt 0)

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Crazy fool, for the purposes of UK and EU Law they certainaly are.

Legally the term is a "scale monopolist".

An example in the UK is Walls Ice Cream.

4:53 pm on Jan 29, 2003 (gmt 0)

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Zamboni:

I also just came in to see if anyone else had noticed. I thought I was going crazy. For the last three days I've noticed that I'm being charged the autobid amount when in fact the actual bid was much lower. This must have something to do with the automatch system. We should probably start a seperate thread on this.

What I've just done is change all my bids to "fixed" and lowered them to the amount that is just above the one below me. This will not only reduce my billing but also the billing for the bidder above me. I just hate being taken advantage of and Over is getting to the end of my patience. Yes I want to be there but I don't want to look like a fool. What is the point of autobid if they are just going to charge you the higher amount anyway. Also, if they are going to charge a higher amount because of automatch then show us what the term was and allow us to opt out if we don't agree with the match.

Rant over...

Edit: I just started a new thread on this.

6:40 pm on Jan 29, 2003 (gmt 0)

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Espottings 600 million searches, Adwords delivery of however many million searches daily, Mirago, Looksmart Bidsmart (until the end of this month at least) certainly doesn't make the Overture set up a monopoly of any sort.

Crazy_Fool is right, if the goal posts move then you adapt or die. The more people that die or vote with their feet the less competitive it becomes, the better value that can be extracted.

It might make people think twice before they adopt a scattergun approach to advertising and keyword selection.

Before Christmas I was pulling my hair out because we couldn't get ads approved and it was advertisers submitting thousands of keywords at 5p blocking the system.

Obviously it will affect things, price changes always do. But is this any worse than Google imposing a minimum CPC for ads to be shown in the US? Looksmart survived their move to CPC from directory and I am sure that Overture will survive this one also.

Where will the monopoly be next?

gsx

9:00 pm on Jan 29, 2003 (gmt 0)

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Just for a change, I agree with Crazy_Fool ;)

Overture does not have a UK monopoly; Espotting are roughly similar size, therefore competition is available at a similar level.

A true example of a monopoly was BT several years ago. Now NTL are competing with them, they would no longer be such (thus allowing complete privatisation).

1:46 am on Jan 30, 2003 (gmt 0)

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Its not to do with whether they are a monopoly, ok that's the term, but when it comes to the UK its to do with Market share, I would hazard a guess that Overture's is over 40%, that means technically its a monopoly, even if its really part of a duopoly or an oligopoly or whatever.

Its not their market share, but the actions because of the market share that is the issue and something that the OFT should look into I think.

1:45 pm on Jan 30, 2003 (gmt 0)

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If everyone here jumped ship and went to espotting or elsewhere, they may reduce it again :)

and it would teach them not to be greedy.

I was about to sign up with overture - but i will go elsewhere now :(

Well thats my opinion...

3:20 pm on Jan 30, 2003 (gmt 0)

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i predict that google and espotting will soon follow.!
3:23 pm on Jan 30, 2003 (gmt 0)

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I think just for one day we should all drop our bids to 5p a click just to annoy Overture.

It may also reduce the bid prices!

3:40 pm on Jan 30, 2003 (gmt 0)

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Kandevil is quite right.

The problem I think may be defining the market. We took a case to them were a major PLC had a 90% market share of a certain market and the OFT ruled it was part of a larger market.

If they saw PPC as part of the UK advertsing market Overture could sleep easy.

3:41 pm on Jan 30, 2003 (gmt 0)

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sem4u - "I think just for one day we should all drop our bids to 5p a click just to annoy Overture."

Unfortunately not all Over UK advertisers are Webmaster World readers. (although they should be)

WordAds just reduced many of their minimum bids in the USA so it isn't likely they will start increasing them in the UK - IMO.

generator

11:33 am on Feb 2, 2003 (gmt 0)

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why anyone should be suprised that they have done this is beyond me, this is blatent profiteering, i am convinced they should be taken to the monopolies commission.
They do not want anyone to be business minded. I have 400 phrases between 5-9p and i have just doubled my cost, but for what return, and what extra.
i can't wait till there is a down turn in the market and they loose a lot of advertising budget and then lets see what they do. arrogence springs to mind. i am switching to other ppc engines where they have some customer service.
Have you notice they alwats dend emails out Friday nights when everyone is in bed.
2:48 pm on Feb 2, 2003 (gmt 0)

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>>i have just doubled my cost, but for what return, and what extra.

review your campaign now - how much profit do you make out of PPCs now? if you can make a profit at 5p or 6p per click then you should be able to make a profit at 10p per click too. remove the listigns that earn you the least (or nothing) and keep the rest. tweak the listings to attract buyers, not lookers. etc etc etc

i'm running a campaign with a 1.65 profit per item - we can still make money even at 10p per click.

2:56 pm on Feb 2, 2003 (gmt 0)

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ackk,, who cares.. I think other PPC's including google will raise their mins too.

great news for SEO's... (scrambling for my tatterred copy of web position gold...),, <joke>

3:00 pm on Feb 2, 2003 (gmt 0)

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I contacted Espotting and spoke to the chap I deal with he said they have no intension of increasing the minimum bid, of cause that could all change next week
5:48 pm on Feb 2, 2003 (gmt 0)

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nagnagnag....

But what can we do about this? Are we sitting back and accepting this?

I for one am not going to accept this. Of course they will do what they want; but there must be an official instance were to report them.

I am not from the UK but knowing a bit how government works over there you just CAN NOT increase your price one day by 100%.

You must be joking!

Does someone know were to report Overture or at least do a complaint?

Thanks

9:22 pm on Feb 2, 2003 (gmt 0)

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>>I am not from the UK but knowing a bit how government
>>works over there you just CAN NOT increase your price one
>>day by 100%.

any business, including yours, can increase prices whenever they like. overture have given fair warning of the price increase. they are doing nothing wrong at all. sure, i'd prefer 5p per click, but 10p per click will weed out a lot of the competition that are only paying 5p to 9p per click and forcing me to pay 10p per click anyway.

the increase is not 100% - it's an increase in the minimum cost per click. there are many bids above 5p and above 10p already.

overture do not have a monopoly. the price increase does not prevent you from trading. at worst it means you have to be more selective with your listings, be more efficient with your targeting, work on your conversion rate etc.

9:35 pm on Feb 2, 2003 (gmt 0)

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Although Espotting et al may well have no intention of raising prices you can bet that all of the search engines that partner with Espotting Google etc.. will sit up and take notice.

They clearly are trying to make money, a lot of the presure on prices will come from the partners keen to get more out of the relationships, so whether they have intentions to not raise prices, they might have to in order to compete.

Google will have to change the way things are negotiated with AOL etc.. once they go through their IPO, but for now that probably gives them enough leverage to keep things as they are.

The effect of advertisers leaving Overture and going to Espotting etc.. will only drive up the competitive nature of keywords over there, so although you might be able to get keywords for 5p the chances of getting them will be slim.

It's still about ROI, nothing there has changed, if you need to keep competing look at the prices you charge yourself, it may not need a 100% increase, more like 5-10% just to stay competitive. After all nobody will have exclusively sub 10p keywords with fantastic ROI, there will be some non clicked junk as well as chestnuts.

4:34 pm on Feb 3, 2003 (gmt 0)

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If I had to guess, I would say the UK min bid raise is a feeler test for the US. They may be testing to see if the market here would stand a price increase. If it backfires on them (everyone jumps ship) then they may decide not to touch the US market.
9:16 pm on Feb 4, 2003 (gmt 0)

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The test is over, the minimm bid will be 10 cents in the US this Thursday, the rep told me he didn't think it would affect advertisers and it would force out my low end competition. I think he expected me to be happy about it. I will definitely be wieghing Google and Sprinks for new clients.
12:56 am on Feb 5, 2003 (gmt 0)

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I suspect this is more of a cost costing move rather than a revenue generating move. I doubt this will have significant impact on partner click revenue, but that's a guess.

Google seems to have a more efficient operation - less hand work - so Google may not be under as much pressure to make a similar cost cutting move.

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