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January 7, 2005, 7:15 pm
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1.. "AdWords Discounter automatically reduces your average =
cost-per-click to be just 1 cent more than the minimum necessary to stay =
ranked above the next lower ad. No more need to monitor and revise your =
prices [?]. "
This statement is misleading and untrue on several counts:
1) The 'Adwords Discounter' recommends a maximum cost per click to the =
advertiser during the signing up process. This amount is calculated to =
place the advertiser's banner in the No 1 position by dislodging the =
existing No 1 banner, which then becomes " the next lower ad" referred =
to in your text.
So "the next lower ad" is in fact the No 1 banner! You should be upfront =
and clear on this point and not mask the truth.
2) Each new advertiser who joins the Adwords program and who accepts the =
recommendation of Google will therefore be paying one cent more than the =
previous No 1 advertiser - and so the price for a selected keyword will =
steadily rise in increments of 1 cent every time a new advertiser joins =
the system with the selected keyword and who accepts Google's =
This is not market forces at work dictating the price, but Google's own
'discount' tool which increases prices by default and by reason of
advertisers relying on the automated Adwords Discounter to provide the =
most cost-effective service!
The tool is not actually a 'discounter' at all - it is an automatic
'incrementer' working rather like a web page hit counter, which jacks up =
the prices of keywords automatically by 1 cent with every new =
advertiser. So even the name of the tool is deceptive.
3) Why would advertisers passively rely on the recommendation made by =
the automated Adwords Discounter when setting the maximum cost per click =
for their campaigns?
The answer is simple and is given by Google itself in the Adwords =
signing up process: "There is no more need to monitor and revise your =
prices" when using the Adwords Discounter! This is patently untrue.
The fallacy which Google is promoting is that market forces are =
dictating the prices of keywords, when in fact advertisers are lulled =
into accepting the automated recommendation without appreciating that =
the tool is designed to keep the advertiser's banner in the No 1 spot at =
the highest price.
The only factor preventing the prices of keywords from increasing ad
infinitum is the advertisers usually receive their credit card =
statements on a monthly basis, which is when the advertisers themselves =
go ballistic when they see the charges which the Adwords 'Discounter' =
In setting my own maximum cost per click to 10 cents, I have received =
1500 clicks for about $210. Compare this with the same number of clicks =
generated by the Adwords Discounter at $956.
I have been duped into relying on the Adwords Discounter and have every =
right to expect a real and honest discount in my advertising bill from =
$950 to around $210.
From Google (1):
My offer for a $100.00 one-time courtesy credit still stands, and I =
would be happy to apply that upon your approval.
From Google (2):
Thank you for your response.=20
As a good faith gesture to you, I will be willing to offer a one-time
credit of $350.00. This is approximately half of the amount that we =
deemed to be the difference in cost between the times that your set CPC =
was altered significantly.
I rest my case - anyone know of a good class-action suite attorney based =
on this admission from Google?
J Riley - Practice Manager,
The Luklinski Clinic London
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