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You may find it strange that someone who's been a practitioner of pay-per-click (PPC) ever since GoTo.com launched in 1998, and someone whose team manages hundreds of millions in PPC search spend annually, would pen a column on the topic of giving up on PPC search. The reality, however, is that in the hyper-competitive world of Google AdWords and Bing Ads, not everyone can survive. It's actually beyond survival of the fittest, because there are scenarios where even a fit company can't survive here.
PPC search advertising is auctioned off in close to real time and, as in any auction, there are winners and losers. The winners get the click and the losers don't, or so it would seem. In auctions, there is a concept called the Winner's Curse. In a nutshell, the Winner's Curse happens when either the click profit profile has been miscalculated and the click is actually unprofitable to the advertiser, or the high bidder (or bidders) have insufficient information to make an accurate bidding decision but have low tolerance for losing the click and so bids high. If you have less information or less accurate information than your competition, you may find yourself in a Winner's Curse situation, which is just one of the signs you should give up on paid search (or fix the problem). Read more...
More about Search, Online Advertising, Auction, Digital Media, and Ppc
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