Here is where the money is spent. You’ve got your ad, your account, your keywords, you are all set to go. Now, you BID! Bidding is telling the PPC provider how much money you are willing to pay for a click on your PPC ad. They use bidding because a lot of people use the same keywords. The only way to determine who winds up on top of the listing is by payment—how much they pay for a click. This is the BID.
You always bid on keywords! So if you have 10 keywords, you must make 10 bids! But you can often bid different amounts on different keywords. It isn’t an “all-or-nothing” deal. There are minimum amounts you can pay for a bid. Some PPC providers will allow you to bid as low as $.05, others have different minimums. A minimum bid will place your ad in the Queue of placed ads for the keyword you have chosen, depending on what other advertisers are bidding on the same keyword. They usually list the top five bids. For example: You are using the keyword: MUSIC and you are willing to pay $.05 for a click.
You may see PPC provider reports that the top bids are: $.30, $.22, $.14, $ .10 and $.05. Your $.05 bid will place your listing BELOW that of the advertiser who is already paying $.05 for a click. If you want to outbid the top bidder, you must agree to pay $.31 per click. You can also bid anywhere in between and your ad will appear accordingly.
You always bid on keywords! So if you have 10 keywords, you must make 10 bids! But you can often bid different amounts on different keywords. It isn’t an “all-or-nothing” deal. There are minimum amounts you can pay for a bid. Some PPC providers will allow you to bid as low as $.05, others have different minimums. A minimum bid will place your ad in the Queue of placed ads for the keyword you have chosen, depending on what other advertisers are bidding on the same keyword. They usually list the top five bids. For example: You are using the keyword: MUSIC and you are willing to pay $.05 for a click.
You may see PPC provider reports that the top bids are: $.30, $.22, $.14, $ .10 and $.05. Your $.05 bid will place your listing BELOW that of the advertiser who is already paying $.05 for a click. If you want to outbid the top bidder, you must agree to pay $.31 per click. You can also bid anywhere in between and your ad will appear accordingly.
Almost all PPC providers will show you the top 5 current bids on a keyword, so you can decide where you want to be in the listing. Most PPC providers will also tell you your position (called a “ranking”) after you submit your bid, and you can change it if you don’t like it by bidding a higher amount. However, be careful. Top ranking is no guarantee of sales or traffic! If the bids are too high, even to be at the bottom of the list, you can simply deactivate or “suspend” the keyword—you basically say, “NO BID”. Your ad will not appear when someone does a search on that keyword.
Or you can bid $.05 (or the minimum allowed). This will place your ad in the search engine, at the bottom of the sponsored listing. This can work for you, so don’t dismiss it! Many PPC system bidding tools have a “make me the top bidder” feature. In this case, you allow the PPC provider’s computer to determine who is top bidder, and then it increases your bid by $.01 so you wind up on top. Obviously, if someone else is also doing this (and you can bet they are) you’ll soon see a computerized bidding war in action, at the speed of light! The computer will keep outbidding you against each other.
There is a solution to this, called a BID CAP.You tell the system that you will only spend, say, $.70 per click on your keyword MAX. This means, if someone else spends $ .71 for their ad (this is their BID), the computer will not bumpyou up. Your bid will stay at $ .70 and the other advertiser will take top position in the search engine. Your listing will be next in the list. If the two of you have the same BID CAP and BID, then whoever signed up first will get top bidding in a tie. If someone else comes along and it is a three-way tie, and that person arrived at the PPC system after you did, then you outrank them. So you are below the first advertiser, but above the third in the search engine listing. Many PPC providers will caution you if you are overbidding, so you don’t waste money.
For example:
Suppose you are bidding for a PPC ad placement using the keyword MUSIC. You see that the top bidder is paying $.35 per click. All you need to spend is $.36 to get top placement. But, for some reason, you tell the PPC system that you want to bid $.75. Very often the PPC system will reject your bid and drop it to $.36 so you aren’t wasting money. This also prevents people from “stoking the furnace”, causing artificial inflation in bids. However, you should check with your PPC provider to make sure their system will do this for you. And that’s basically how PPC works. The best advice anyone can give you is to READ the PPC provider site thoroughly and if you have questions, call their customer support and ASK questions! It is up to you to manage PPC advertising by using the provider’s system wisely and well. Now—onto those problems and how to avoid them!
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