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How Google Prices

         

poster_boy

10:28 pm on Feb 17, 2006 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member



Snippet from Google's print auction pricing model. Interesting insight into, potentially, how Google prices Adwords bids.

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How much will I pay if I win?

Similar to our AdWords discounting policy, we'll automatically reduce the actual cost you pay to the lowest price needed for your ad to win space on that page. So, you'll never pay more than your bid, and in many cases you may pay less than the maximum price you set, since the final prices are determined by giving each winning advertiser a discount equal to the value they added to the auction.

For example, say you bid $1,000 for space on a given page and the total of the winning bids for that page is $2,500. If you hadn't bid for the page, the total of the winning bids would have been $2,300. Therefore, you'll get a discount of $200 ($2,500 - $2,300) and end up paying $800 for your ad space ($1,000 - $200).

mack

1:10 pm on Feb 19, 2006 (gmt 0)

WebmasterWorld Administrator 10+ Year Member Top Contributors Of The Month



Very similar to smart pricing.

Mack.