Introduction to the Google Ad Auction
Google adwords is probably the most used pay per click advertising and it can help anyone, any business, large or small, reach millions of potential customers with remarkably little effort.
As with any paid advertising however, it is important to remember that yiur budget needs to be tightly controlled and can also be eaten up very quickly indeed.
adwords is no longer a game for the novice or the unwary and many people have lost their shirts playing the PPC game. Having said that, many people have also made of lot of money using Google’s industry leading targeted advertsing and paid search results.
In this Video, you will see a clear explanation of how the Google Ad Auction works and how your cost per click is calculated by the company and how your ad will fare in the face of competition. It is pretty straightforward but you will also note just how these few factors can affect your cost, your click through rates, and your position in the paid results for a given search term. Understanding the competition is one key factor you really must consider if your ad campaigns are going to be profitable as you will see.
Our Chief Economist, Hal Varian, explains the adwords Ad Auction and how your max CPC bid and quality score determine how much you pay for a click on Google.com.
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