How to Define Your Keyword Price on Google?

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Recently Hal Varian, Google Chief Economist, explain in Google Blog of how the search engine define the process of keyword pricing, heres the excerpt of  5 (Five) Step of Pricing Process

  1. Each advertiser enters a list of keywords, ads, and bids.
  2. When a user enters a query, Google compiles a list of all the ads whose keywords match that query.
  3. The list of ads is then ordered based on the bids and the Ad Quality Scores, which measure the relevance of the ad to the user.
  4. The highest ranked ad is displayed in the most prominent position, the second highest ranked ad gets the second most prominent position, and so on.
  5. If the user clicks on an ad, the advertiser is charged a price that depends on the bid and Quality Score of the advertiser below it. The price charged is the minimum necessary to retain the advertiser’s position in the list.

This process is really important to learn if you serious on PPC advertising, so make sure you aim for low pricing keyword, or high on price but worth it.

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  • 5 comments

    1. MyAvatars 0.2

      Avatare personalizate May 14

      We can use google adwords external tool for knowing more details.

    2. MyAvatars 0.2

      Dropship Design May 15

      thats a cool little diagram, it helps me to understand what PPC is all about. good stuff mang.
      -Richard

    3. MyAvatars 0.2

      zam May 15

      Yes cool digram make me understand how PPC works.

      such a big feedburner logo u have!!!

    4. MyAvatars 0.2

      Andika Kusuma May 16

      @Avatare: yes you can use external tool, but you need a good understanding how it work to boost the usage of that tool.

      @Dropship design: thanks :D Richard, your comment have been motivated me to update more often with a good article.

      @Zam: hahaha yea its big isn’t it? can you resist not to click it? :D

    5. MyAvatars 0.2

      Jack Johnson May 17

      Neat little tool. I always wondered how google ranked their ads. My quality score must be low or I am just too cheap to spend over $1.00 a click.

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