Assume we have three people bidding for the same keyword:
Bidder #1 max CPC .50
Bidder #2 max CPC .27
Bidder #3 mam CPC .10
Since Bidder #3 is paying .10, wouldn't #2 pay .11 and #1 pay .12?
This seems a little too straight forward since their CTR are probably different and they could all be using different keyword matching options.
Still, if we assume they all have the same CTR and are using the same keyword matching options would the above example hold true?
More curious from the perspective of how Adwords would handle this situation as the liklihood of everything "working out" in terms of CTR would be low.
Any thoughts?
Jeremy
Bidder #1 max CPC .50
Bidder #2 max CPC .27
Bidder #3 mam CPC .10
On Overture that means:
Bidder 2 pays .11
Bidder 1 pays .28
Then again, just noticed I am in the Adowrds forum! Oops - best read the other thread as suggested by vibgyor79!
i am not entirely sure though
Adwords doesn't exactly work like that since it is not a straight-forward system like overture.
The real difference is that on Overture the only factor considered in determining your postion is your CPC, as compared to your competitors.
With AdWords, the relevance of your ad to Google users, as judged by your CTR is equally important.
So position on AdWords is always dependent on two factors, weighted equally:
* Your Max CPC for the keyword, as compared to your competitors, and
* Your CTR for the keyword as compared to your competitors.
For this reason, it isn't possible to calculate your cost as compared to your competitors, without also knowing their CTR.
There was in fact a thread that gave a detailed example of this not too long ago. At the moment, I can't put my hands on it though.
AWA
