PPC hyperinflation reported at 2000%

17 comments

Wow, Google’s Quality Score is really starting to bite hard on some PPC budgets. I’ve just taken a call from Auctioning4U, a UK-based firm that helps people sell goods on eBay, and they are reporting that average click costs have risen by almost 2,000% in just one week.

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I can see this helping the SEO industry... because SEM is quickly turning crappy.

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One more data point

Well, my campaigns are running as good or better than every. No inflation of PPC costs for me. Of course I'm in a niche where I'm paying $4-$5 per click already and it's $20 for front page on the big terms.

I do think this latest change is wrong. Something stinks if they have to keep their judgement secret. The only reason I can see for doing that is because they're scared of being questioned, likely because they're using factors that are too subjective.

What I don't see is a clear line on how they will make more money on this. Chances are reasonable that they'll make less. And yes I'm one of those that if this started hitting me hard I'd be happy to either drop my PPC campaigns, or spend the same money on SEO. In fact, thinking about my PPC budget, geesh, I could buy an awful lot of distributed servers/websites and links. A few thousand in sponsorship dollars to authority sites here and there every month...heck, I'd likely be saving money. Hmmmmmmmm.

Legalities

One thing I haven't seen is any legal minded webmasters chime in on the subject. Charging one person $0.50, one person $5.00 and another person $10.00 for the same service based on an arbitrary standard that's not well defined reeks of an unfair trade practice. Seeing as how I'm spending less time looking at my PPC stats I do have time to contact the following two bodies about the issues

Phone: 1-888-647-3258 (toll-free in the U.S. and Canada) or 1-202-307-2040

Address:

Citizen Complaint Center
Antitrust Division, U.S. Dept. of Justice
950 Pennsylvania Ave. NW, Suite 3322
Washington, DC 20530

Elliot Spitzer's Office for internet complaints

http://www.oag.state.ny.us/online_forms/complaint_misc.jsp

Graywolf

Greywolf, even though i want to think this is illegal, i dont think it is...there is a lot of precedance for secrative variable pricing, the airlines for example are doing this for decades.

Two choices

from the article:

Quote:
“increase bid to £5.50 or improve quality score”.

Which seems like it's a quote from Google. That's a rather hypocritical statement if the intention is to improve landing page quality. Clearly they're quite happy to continue to to have crappy landing pages as long as you're willing to line their pockets.

Example

Actually This thread has inspired me to go out and create an ad with keywords and show all of the details of what's happening and the double standards being used ... stay tuned...

webmasterradio

I havent listened to it yet, but on 05/26/2006, one of webmasterradio's topic was Google AdsBot Now Coming To Assess Your Landing Pages, Will Impact Your AdRank and More!"

http://media.webmasterradio.fm/episodes/audio/2006/SC052606.mp3

Hurting Everyone

I'm not a guy who does much arbitrage type stuff, but it's even hurting me. On terms where I was happy to bid $1 to be in the top 3, I'm now being told I have to bid $5. I just can't afford to do that so I've stopped using Adwords for a lot of stuff.

class action

The class action process is a joke, and recently Google showed that with its $90 million "penalty" for 4 years of click fraud (majority goes to the lawyers, of course). The citizens don't seem to care abut these things, yet here it is biting the small business owner in the ass a few months later.

Your recourse Graywolf is to sue. Since you can't afford to sue Google, form a class. That's what your legislators have secured for you - the little guy can form a class. Now go ahead and start a class action suit. See where it gets you.

Google's new motto: "Have no fear"

Horrible Execution, Google

I do a lot of arbitrage in my personal stuff but I also manage a little over a $2M/USD in Adwords spend for the biz and some consulting clients. Here's what I'm seeing:

1) My arbitrage traffic did take a hit but the higher bids on the Adwords side are netting out higher EPC's on the publishing side. So, all told, the pushbutton stuff is actually up a lil bit.
2) Some of the old clients who spend less than $100GR/year have gotten slaughtered with new bid minimums. They are going to have to let some people go because of this.
3) The big biz had virtually no impact. There are some campaigns in there of pretty poor quality (certainly of less quality than some of the old crusty campaigns on the consulting side) and they're still clicking off just fine. Actually, CPC's are down a little bit because we see less competition in a few of these areas now. Not one of these campaigns is more than 3 months old...we just spend an metric shitload with G.

Google never really had to advertise or proactively brand in the early days because of the grassroots support. Maybe they can still succeed without the little guy, but what a freaking slap in the face to those whose backs the climbed to the top.

What I don't understand is

What I don't understand is that you have people willing to make better landing pages, but they're not told what to improve.

It doesn't make any sense.

aff game

Isn't this really a slaughtering of the low-effort affiliate game? I can't see past that... it seems so obvious to me that someone over there said "the party's over" for the affiliate small guy and raked the table (with priority set by the impending Google affiliate endeavor).

I think that's a good bit of

I think that's a good bit of it, John. Unfortunately, they are letting the dominos fall a little prematurely and creating a lot of discontent with the middle of their bell curve. For a company with such great branding, they sure suck at product launches. Imagine if any other company pulled this shit.

What is the GOogle affiliate endeavor?

What is the Google Affiliate Endeavor?

Monkeys

yet the ads for monkeys at ebay still abound...

ebay ads

The ebay ads have gotten more honest. Today they say "xxxxxxxxxx - Whatever you're looking for
you can get it on eBay."

Leave it to eBay to co-opt contextual ad serving to bring you static banner ads. And Google to charge them for it.

As for this scoreboard:

Quote:
Unfortunately, they are letting the dominos fall a little prematurely and creating a lot of discontent with the middle of their bell curve.

I really don't see Google agreeing with you (although I do). I see Google knowing it can corral *millions* of new webmasters and bloggers going forward. New ones that don't ask a lot of questions and don't press for much (any?) tech support of accountability. For every 1000 pages published by a pro, Google can get 100,000 pages published by an amateur. Do they make less money from the amateur pages? I'm not sure they make 1/100th.

Now are they opening the doors to competitors? Yes, but they can shut that down via barriers on other fronts. Not too many competitors can grow fast enough with only the middle class available to them. We've only seen the tip of the restrictive TOS I think.

Graywolf

On the principle that it couldn't hurt, I fired off a quick complaint to Elliot Spitzer's office on the link you provided. I'm under the impression they pay attention to it only when they get a substantial number of complaints on the same issue though? I'm not from the US so I'm not an expert.

the more the better

I have alsp filed a complaint with the Federal Trade Commission (FTC) and I would encourage anyone else in this situation to do the same.
The web site for the FTC is: http://www.ftc.gov/ftc/consumer.htm
It only takes a couple of minutes to file a complaint online and I think it will do some good in the long run.
Thank you.

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