Are Corporations Capitalizing on Google AdWords in the Poor Economy?

Dec 23, 2008 • 9:13 am | comments (4) by twitter | Filed Under Google AdWords

A WebmasterWorld member is disappointed that he as a Google AdWords advertiser is unable to bid with any reasonable price on any ads because corporations, as he sees it, are greedy and are raising bid prices. He is frustrated that these corporations are not interested in lowering their bids to a profitable level and thus his ads are not appearing given that some big company is driving up the costs.

But is that really what's happening? Perhaps there are corporations that don't care to lower their bid costs, just like the guy says. But perhaps there are corporations that fired their Google AdWords consultants or Internet Marketing type people and they simply forgot to regularly review the Google AdWords accounts. That means there are hundreds of thousands of wasted dollars on ads because the companies are not evolving with the times. That's more likely in this scenario.

What do you think?

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Daniel Fallon

12/23/2008 05:08 pm

Adwords is an almost perfect free market that has low barriers to entry and consequently in any mature PPC sector margins are wafer thin for "average" advertisers. Each advertiser will seek to maximise their profit and those with larger margins (more sohisticated corporations who cross sell and get better customer lifetimne value) will bid higher to gain share. The poster is either extremely well informed about his competitors bids & profit margins or naive...more likely the latter. Sorry!

Todd Mintz

12/23/2008 06:53 pm

Sounds like a poorly managed account to me. If the bids are too high to compete, they need to move "down the keyword tail" because the longer tail keywords will be more affordable and less competitive.


12/24/2008 04:00 am

You are spot on. I manage Adwords for companies, when they come to us, it's usually because they overspend when they get their statement.

diarmuid ryan

12/24/2008 01:18 pm

seems reasonable, every one is trying to save no matter size, so reducing adwords cost should be priority all over

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