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Maximum bid for first page bid and cost of click

Visitor ✭ ✭ ✭
# 1
Visitor ✭ ✭ ✭

How does Google determine the price of a click? For example, if I set the maximum click amount to $2.00, and the estimated bid price for a first page was $1.00, what would be the cost of the click?

If I have a higher maximum bid price, will I be charged more for the click, even if the first page price is lower?

Should I put the maximum bid price close to the estimated bid price for the first page?

2 Expert replyverified_user

Re: Maximum bid for first page bid and cost of click

Top Contributor
# 2
Top Contributor

Hello brucegoogle,

 

The actual cost per click is based on what max CPC you have set and what is the Quality Score of your keywords. Based on this Google calculates the Ad Rank and higher your ad rank is, lower you will have to pay for that keyword in order to win the ad auction.

 

Lowest price is charged for an advertiser, which is important to win the ad auction on that particular page. 

 

You can refer to this for more details.

 

Hope that helps!

Pankaj

Re: Maximum bid for first page bid and cost of click

Visitor ✭ ✭ ✭
# 3
Visitor ✭ ✭ ✭

Hello Pankaj,

Thanks for your reply. I was reviewing some of my maximum bids for my keywords. I found that I was setting those bids far above the needed bid for the estimated first page ranking.

 

Have I been unneccesarily paying more for the clicks, if the first page estimated bid amount is far lower than

the bid I set?
Thanks.

Bruce

Marked as Best Answer.
Solution
Accepted by rashu (Google Employee)
September 2015

Re: Maximum bid for first page bid and cost of click

Top Contributor
# 4
Top Contributor

Hi Bruce,

 

I have seen many times advertisers only focussing on their max. bids and they often rule out another very very important metric i.e Quality Score

 

No doubt you set your keyword's max bid as high as possible, but if that keyword is not relevant in the eyes of Google (meaning that Quality Score is low), it will not be worth enough bidding so high. My advice would be to take care of the QS also in addition to keyword's max bid. Because if QS will be good, you will have to pay less and automatically Avg. CPC would be low and your Ad Rank will be high.

 

So keep optimizing your account by working on CTR, high QS keywords. It will surely give you good ROI and a strong Adwords account.

 

Wish you success!

Pankaj

Re: Maximum bid for first page bid and cost of click

[ Edited ]
Explorer ✭ ✭ ☆
# 5
Explorer ✭ ✭ ☆

Actualy the exact amount you will have to pay for  a nr 1 position depends on your competitors Bid and QS.

 

Wheter you are going to be shown on first position depends on your Bid and Quality score.

 

Securing nr 1 position: You need to have the Highest AdRank ( QS x Bid)

 

On the nr 1 position  you pay AdRank Pos. 2 devided by QS Pos.1.

 

Therfore Bidding to high to be on the nr 1 spot is not possible.

 

(please correct me if i am wrong)

 

 

Re: Maximum bid for first page bid and cost of click

Top Contributor
# 6
Top Contributor

No, you're not wrong, marketsharer.

 

Actually you pay (Ad Rank below you / Your QS) + 0.01. Your bid only determines your ad rank, not the CPC you end up paying.

 

Here's the famous Hal Varian explaining how things work.

 

Calin Sandici, AdWords Top Contributor | Find me on: Google+ | Twitter | LinkedIn | myBlog
Was my response helpful? If yes, please mark it as the ‘Best Answer.’ Learn how here.

Re: Maximum bid for first page bid and cost of click

Explorer ✭ ✭ ☆
# 7
Explorer ✭ ✭ ☆

Your Video is for Adsense Publishers I think Smiley Happy And I want some of those  QS of 12 too !

 

The complete QS-AdRank story:

 

http://www.youtube.com/watch?v=zStNy_PImyQ&feature=related

 

Re: Maximum bid for first page bid and cost of click

Top Contributor
# 8
Top Contributor
Oops, I sure attached the relevant one Smiley Wink. Luckily the principle's the same. And thanks for correcting me.
Calin Sandici, AdWords Top Contributor | Find me on: Google+ | Twitter | LinkedIn | myBlog
Was my response helpful? If yes, please mark it as the ‘Best Answer.’ Learn how here.