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I am at a lost how my competitor is paying so much for adwords

Discussion in 'Adwords' started by jonnyboy, May 15, 2011.

  1. jonnyboy

    jonnyboy Junior Member

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    Hi all,

    I have noticed that one of my main competitors consistently pays for his site to be ranked at the top of goole adwords. The industry that I am targetting sells products for around £5 and allows for a profit of £2.50 per sale.

    What really is confusing me is that fact that the clicks on the niche are very expensive, around the £.80 mark. I am therefore really confused how this particular site owner is making adwords work for him.

    Would anyone have any ideas how he is making it work ?

    Regards. John.
     
  2. BassTrackerBoats

    BassTrackerBoats Moderator Staff Member Moderator Jr. VIP

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    Occupation:
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    It's an Algo, of course it can be gamed.
    Home Page:
    Any chance he has a bevy of adwords giftcards/vouchers and is just making new adwords accounts and using them?
     
  3. jonnyboy

    jonnyboy Junior Member

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    I was thinking that but the research I have done on him through forums etc, shows the site owner not to be really that IM tuned in. Looks like a family run business actually, so dont think that is the case.
     
  4. meathead1234

    meathead1234 Moderator Staff Member Moderator Premium Member

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    Maybe he just operates Adwords at a loss? Wouldn't be the first.
     
  5. extremephp

    extremephp BANNED BANNED

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    If he can manage multiple adwords accounts, he is going to cut down his expense to the minimum, by using vouchers. Multiple adwords accounts are easy, if he can get to diff. Ips.
     
  6. peetu69

    peetu69 Jr. VIP Jr. VIP Premium Member

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    Lot of online shops are looking for returning customers.

    Back in the time i had a customer who was selling meds for animals online. Only a few people were allowed to sell them, because you need to have a license or something like that to purchase and sell the meds.

    However, we did run adwords and the bid prices were pretty high too, though the competiton was very few, because not many people were allowed to sell the meds.

    We did come out with nearly zero profit, but in the end it paid out very well, because most customers who needed meds again came back straight to the store and bought again.
     
  7. jonnyboy

    jonnyboy Junior Member

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    I think you are right. I am sure he also have an offline business, so there must be some tax benefit in doing this.

    Regarding adwords accounts, is it possible to activate them without a text message. This would be really useful, as then I can buy loads of cheap vouchers on BHW.

    Regards. John.
     
  8. dalcacio2007

    dalcacio2007 Newbie

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    maybe he optimized his quality score and pays less than what you have to pay.
     
  9. jonnyboy

    jonnyboy Junior Member

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    good point Dalcacio,

    But what the quality score really bring the price down from .80 to say .10?

    Regards. John.