Google Claims to Not Set Bid Prices for Keywords
Written by Pablo Palatnik on October 6, 2008
Reading the latest article in the New York Times regarding the Google/Yahoo deal which I won’t get into in this post, “Google Deal With Yahoo Draws More Opposition,” I saw a quote that I think many will disagree with and something that needs to be addressed.
Larry Page, one of Googles founders, while talking about one of the issues that is a BIG concern for advertisers (rising cost of search marketing by controlling most of the search market), stated that Google DOES NOT set the pricing for keywords, advertisers do.
THAT MAY HAVE BEEN TRUE prior to the almighty quality score coming along, but that is no longer the case. How do advertisers control the market when Google will set a bid for a certain dollar amount even when there is 3-4 advertisers for certain keywords.
“We keep hearing this argument that Google is going to somehow raise prices by doing this,” Larry Page, a Google co-founder, said last month. “But we don’t set the prices.”
Whether the deal (if it goes through) will raise prices is still to be seen, I personally believe it will, as Googles market share grows, of course prices will increase with more visibility to your ads. If an advertising tells you they are going to placing your ads in more sources/place, whatever, of course you’ll have to pay more money.
So, if Google claims to not set bid prices (false), can you really trust what they say about this Yahoo deal? Google still faces a big transparency issue that holds advertisers back in their trust factor.
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