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1. • CommentAuthormrp
   • CommentTimeJan 10th 2007

    
   My Big Question is....
   
   In my experience Adwords does not adhere to their declared "you only
   have to pay 1 cent more than neccesary to rank just above the ad below
   you" pricing policy. In my experience... even if there are NO ads
   below you.. and you bid "high", your actual CPC will be many times higher
   than if you bid "low" (all the while your MinBid is so low that it
   doesn't even enter into the equation). Anyone can replicate this by
   bidding on a keyword with no competitors.
   
   Example: I'm the only ad running. Min Bid = $0.05 My MaxBid = $10
   Actual CPC=$0.60
   Next day I lower MaxBid=$0.06. My actual CPC=$0.06
   Then I raise it back to $10. Predictably the actual CPC goes back up
   to $0.60 ALL THE WHILE THERE ARE NO ADS BELOW ME OR ABOVE ME!
   
   Is there any way to deal with this, short of getting a few class
   action lawyers on this?
2. •  
     CommentAuthormike
   • CommentTimeJan 11th 2007

    
   You bring up an excellent point! Google does not run a transparent business and until they are forced to do so via market pressure (i.e. increased competition) or legally (class action lawsuits) that is not going to change.
   
   So, the best advice that I have for you is to go into the details of your campaigns and optimize your maximum bids at the keyword level. If your ad is ranking high and getting lots of impressions at a max bid of $0.06, then you should not raise it to $10 if you do not have to. Doing this will also prevent competitors from manipulating your bids.
   
   At the end of the day, on Google what you pay is based on your maximum bid, your CTR, the "quality rank" and what your competitors are bidding. The last two (1) Your Quality Rank and (2) what competitors are bidding is not even disclosed. So, my recommendation is to learn to work with the system and not against it. You don't stand much of a chance of fighting Google but you can collect data and when a class action lawsuit is opened you can let people know about this data and start to blog about it to raise the awareness that Google needs more transparency.
3. • CommentAuthormrp
   • CommentTimeJan 11th 2007

    
   Thanks for the answer, Mike. Sure it's not transparent. But not being transparent is alrite - legally they don't have to. But telling advertisers that they won't pay "more than they have to no matter how high they bid" and then charging them more if their Max Bid is more - that's major shady freaking fraudulent ("Do Evil") stuff - you know what I mean? That's what I got a problem with. Not the general lack/absence of transparency. I'd love to discuss a couple more points about this with you in private, if possible, but I'm afraid it's not.
4. • CommentAuthorcp
   • CommentTimeJan 11th 2007

    
   I totally agree with mrp on this. Google's is effectively LYING to it's advertisers. It's one thing to do something shady without disclosure, but to state one thing & do exactly the opposite is both a LIE & FRAUD. What really bugs me is that Google penalise us with higher CPP for not giving a 'good user experience' on our sites - yet they rip us off with this type of 'bad user experience' on their own site.