Forum Moderators: martinibuster
This is not the first time I've noticed this happening and am wondering why on earth advertisers pay this much for one click?
Although it's absolutely clear that it's an advert that the visitor is clicking, that click may only result in the visitor loading the advertisers page and clicking the back button 2 seconds later. I appreciate that if the click is a new customer for the advertiser, then $10+ for a click is possibly worth it.
I can only assume that it's a) a bubble that's about to burst, or b) the conversion rate for the advertiser(s) justifies that sort of bid price.
I'm EXTREMELY grateful for the clicks, I just can't see why anyone would pay that for one person to visit their website!
M
I'm not going to lose any sleep over it, just having a bit of a ponder on life, the universe and everything.
There is no relationship between the one click you saw and the earnings you saw at that time. Different columns in Adsense update at different speeds. Further, it's often claimed that some metrics are carried over from one day to the next ... or to several days in the future.
Yes, people do spend $10 on adwords (and more).. My neighbor owns a medium sized company and I know he spends about that much because I've seen his adwords account.
I am an adwords advertiser too and in my little world there are folks spending 5,6,7 $ for a click.
In actual fact, there are at least two advertisers willing to pay $10 per click. Assuming it is legit and not a reporting glitch. Why are there two? Well on Google adwords you only pay 1 cent more than the second bidder. So for $10, there must be someone who bid $9.99.
This system also explains why earning can fluctuate: when two bidders are at $10 and one drops out, the bid falls to the next lowest point + 1cent. If that third (now second) position was $2.00 then suddenly the $10 bidder is only paying $2.01 to be number one. It will be the same ad, 20% of the payment.
>> first thing this morning and noticed 1 click registered, and an amount >$10
It's possible there is no advertiser paying $10 in this case as the 1 click is highly unlikely to be related to the >$10.
Recently I wokr up to a similr thing, 1 click and high income. The income was 3 times my longtime-steady daily average. Guess what, at the end of the day the incokme was almost exactly 4 times the daily income. I think one fluke click is more likely then a couple, or a dozend :)
SN
There fore high CPC are just in your mind
I don't think Macro ever insinuated that there can be NO high CPC. We all know that some keywords generate high CPCs, while some do not. That's one of the basic truths of Adsense.
What Macro is saying is to be careful at looking at the stats, especially first thing in the morning as the poster did, because the numbers there may (a) not be updated; and (b) may not be aligned. Another truth to Adsense: stats do not update in real time. So unless you tell me that you are using a tracking software, you can hardly tell what a single click costs just by looking at the stats in your control panel.
You have to realize that some people don't look at how much they spend per click they look at how much money they spend a month and how much money they make over the month or over the lifetime of the customer. There are plenty of places that pay $10 to $35 per lead for aff programs. That is way better than AS if you do it right.
To make money in adsense you don't look for one word that makes money you look for an area. You go to wt and make a top 20 or so list of words for a particuler subject go to OV and get all the the number 2 bids. If you are trying to make a lot of money on AS you need to keep that number between $3 and $5. It is not real acurate but it is close enough. Trust me it works. You can make over $1000 a day if you do it right.
Also you won't make money just getting traffic. You have to get traffic where people are looking for what your AS or AFF advertisers are selling.
Recently I wokr up to a similr thing, 1 click and high income. The income was 3 times my longtime-steady daily average. Guess what, at the end of the day the incokme was almost exactly 4 times the daily income. I think one fluke click is more likely then a couple, or a dozend
And you know for sure that the first click earned you 3 times your daily average? How do you know it didn't earn you only $0.01 with subsequent clicks making up the difference to take you to 4 x average earnings?
It's exactly this kind of cock-eyed analysis/ mis-interpretation of data that I'm trying to warn against ;)
I stand by my opinion.
SN
The poster based his reasoning and subsequent question on an incorrect premise. Your answer may be technically correct insofar as $10 clicks go but it does not address the incorrect reasoning behind the question. An answer that talks about $10 clicks existing - does not address the $10 per click on his site issue... which $10 click may never have existed. Part of the question is "This is not the first time I've noticed this happening...". Actually, what he thinks he noticed happenning is not necessarily what happened at all.
It's exactly this kind of cock-eyed analysis/ mis-interpretation of data that I'm trying to warn against :)
I'm not going to lose any sleep over it
I concur. Now, I'm off to bed.
(Continuing the trend of boldly making connections where no connections have gone before :))
The poster based his reasoning and subsequent question on an incorrect premise.
His assuming that it was indeed a >$10 click is no more incorrect than your continued assumption that it wasn't. In this particular case it may well have been one click that generated that income, just as it may well have been the stats simply not updating uniformly.
>> your continued assumption that it wasn't
Do me a favour, read the thread.
"In actual fact, there are at least two advertisers willing to pay $10 per click. Assuming it is legit and not a reporting glitch. Why are there two? Well on Google adwords you only pay 1 cent more than the second bidder. So for $10, there must be someone who bid $9.99."
I was thinking on this issue last week, and it must be I'm missing something, but if there are two advertisers, then shouldn't there then have to be THREE? And if there are THREE, shouldn't there have to be FOUR?
In other words, for the second bidder to pay $9.99 doesn't there have to be a third bidder at $9.98?
and so on, which clearly isn't the case. So how the heck does this all work?
I work an area that the biggest bids are about $9. I have seen days where I seemed to have $9 clicks. I'm pretty sure that is not true. On avg I got $1 to $2 avg days. There is no way to know what single clicks are. Even if you are in an area that has $50 bids you will still get days when you get a lot of $1 and $0.10 clicks. I know this because I bid $0.05 on a term one time that tops out at $10 a click and has tons of bidders. I got clicks from AS sites so I know G was showing my ad instead of one of the big ones.
AS is not an exact science. You just learn the tricks to get the most out of it. All that matters is how big your check is at the end of the month.
Well on Google adwords you only pay 1 cent more than the second bidder. So for $10, there must be someone who bid $9.99.
This system also explains why earning can fluctuate: when two bidders are at $10 and one drops out, the bid falls to the next lowest point + 1cent. If that third (now second) position was $2.00 then suddenly the $10 bidder is only paying $2.01 to be number one. It will be the same ad, 20% of the payment.
And others:
msg#8 preferred to the above post.
Darkmage
Great post!
So thats one other reason for the wild dynamics some have experienced in EPC.
Msg#20
In other words, for the second bidder to pay $9.99 doesn't there have to be a third bidder at $9.98? and so on ...
and msg #21
If the first bidder is $30 the second bidder must be $29.9 ...
You're are far off the mark, see my old thread:
The biggest misconception in AdWords "1 penny over"
to take over the top position. A reminder for new users
From this post, the #1 position ad can pay over $10 while the second position ad pays less than $1, in some cases, depending on their CTRs. The top ad can sometimes pays less than the second or third position ads. This is ADWORDS not OVERTURE, it's far more complicated.
"If the first bidder is $30 the second bidder must be $29.99 there does not need to be any more bidders."
Why not? the $30 bid is one penny hire than the next highest bid -- in this case $29.99.
How is the $29.99 bid calculated? Wouldn't it be one cent more than the next lowest bid? And so on and so on?
(obviously it can't be that way, so how IS it done?)
Thank you for posting that. I had no idea it was so screwed up.
"If the first bidder is $30 the second bidder must be $29.99 there does not need to be any more bidders."How is the $29.99 bid calculated? Wouldn't it be one cent more than the next lowest bid? And so on and so on?
(obviously it can't be that way, so how IS it done?)
Actually, this case is impossible to take place in AdWords if there are only two bidders for the keyword.
If there are only two ads for the keyword, the actual CPCs for each bidder are as followings:
The position 2 ad (lower one) pays $0.05 (the minimum) and the position 1 (top ad) will pay somewhere between $0.05 to $50+. Don't you believe me?
For example:
Advertiser A is the only advertiser for the phase "buy widget". He set his Max CPC at $10. Since he is only bidder, he actual pays only $0.05 although he sets his max CPC of $10. He wrote a good ad and his CTR on the phrase is high.
Advertiser B also wants to advertise for the phrase, he bids at $0.05 (max. CPC) and get the position 2 (bottom). Since the ROI is good, B decides to take the position 1. To get position 1 with his CTR of 1%, B has to pay
$30.01 if CTR for A is 3% [(3%x10+0.01]/1%=$30.01
$50.01 if CTR for A is 5% [(5%10+0.01]/1%=$50.01
Advertiser A pays only $0.05 for the second or bottom position.
If B thinks it's too costly to take top position, he decides to test the water by increasing his bid to $10.0 (Max. CPC). His position ranking (B) will be 1*10=10, A will pay (10+0.01)/3=$3.34 if his CTR of 3% or (10+0.01)/5=$2.01 if his CTR of 5% for the top position. In this case, CPC for B will be dropped back to the minimum.
Hope I don't confuse you.
Ok. Just to keep this simple for the moment, let's assume that all advertisers have exactly the same CTR (let's hold that constant).
A bids a max of $10.
B bids a max of $9.99
Ok. So A would pay 10 bucks (one cent more than the next bid). BUT since there are no other bids, what actually has to happen is that B ends up at the minimum, which then causes the $10 bid of A to move to .06.
It seems to me what we seem to have on the surface of it is a chain that has to collapse to the lowest bid. I don't think that can possibly be the case. For example for a number of phrases/words, I see what seems to me to be about 20 advertisers with actual bids running in the teens right down to 5 cents. (looking at the data I have as an advertiser). The actuals also seem to run that range, not just the max. bids.
I guess what I'm asking is if you have that situation -- a limited number of advertisers (let's say 20)with a wide range of bids, why doesn't it all crash down to 20 bids, all one cent apart at the low end?
Bid range for each keyword will be narrow or wide open depends on three main factors:
- number of bidders,
- Max. CPC
- CTR
The range can be 5 cents to 6 cents or 5 cents to $100.
This is a reason why $10+ per click is not uncommon for certain keywords or phrases.
OK, I can see the points about the metrics. Looking at the previous month's figures, the clicks G registered mean that if you assume some clicks were low, some must have been quite high in order to achieve the payout in my bank account.
I can understand how big advertisers pay lots of money for leads, but that is not the type of advertiser who I see on my site. The ads I mainly see are for individual's business practices.
The point I originally was trying to make is that some of the clicks on my site *are* large, and I can't see why the advertisers I typically see would get that many leads to justify this (from their point of view).
However, the mad bidding seems to have returned to more normal levels this week.
BTW I was quoting a simplified case and if one stops advertising, you'll see a big drop in income. I didn't either bother with the impact of smart pricing.
What I find interesting about this thread is that people like FromRocky know how complicated the Adsense/Adwords system is and the amount of fluctuation that can occur as a result. With this information I am surprised to see simplistic threads that try to look for some pattern that proves Adsense is going backwards, when normal fluctuations seem to the cause:
[webmasterworld.com...]
[webmasterworld.com...]
Finally David_UK as Macro pointed out, beware of trying to interpret the first few numbers after midnight. If you have a channel earning $10 per click over several days and thousands of impression, that is a lot different to an interim 'Today' report at 1am that says 1 impression, 1 click, $10 earning.
