What could you possibly learn from Ted Turner about pay-per-click advertising, you ask?
After all, that’s the guy who lost literally billions of dollars when his CNN Time-Warner thing merged with AOL. And he never even used computers.
Doesn’t mind.
See, with AdWords (and other PPC networks), it’s still about BIDDING. Whoever bids the highest amount for some keyword or virtual piece of real estate get`s the eyeballs.
How Ted Turner got a billboard company for dirt cheap
Back in the days when Ted Turner was just a young and upcoming guy, there was a local billboard company that was up for sale at an auction.
There was one guy in town who owned the other billboard company, and he thought nobody would be interested in that auction. So, at the day of the auction, he went there – and he was right. Nobody was there.
But then, just half an hour before the auction ended, some guy in a worn out suit with an old briefcase came by, and gave an envelope to the auctioneer.
This was not one of those open bidding things, where people are raising hands and the new price is proclaimed. This was a silent auction. You make your bid in a concealed envelope, and whoever bids most, wins. But you can’t know how much the other guys are bidding.
So, the local billboard company owner was took by surprise – but given the appearance of the guy in the worn-out suit, he didn’t feel he’d have much to feer. So, just 10 minutes short of the end of the auction, he made his bid too. 50,000 USD. He knew that the billboard company he was about to aquire was worth multiple times that amount. It was almost a free gift for 50k.
What he didn’t know was that the guy in the worn-out suit was a lawyer who was instructed by Ted Turner not to shower that day and go to the auction with a lousy suit and lousy shoes, and make his bid.
The auctioneer then proclaimed: the company goes to the winning bidder for an amount of…
fiftythousand and onehundred dollars.
That’s right. 50,100 USD. To Ted Turner. Turner figured that the guy would probably bid 50,000, so he went for 50,100. And got the company.
Ebayers know it
On ebay auctions you know it too. Many “advanced bidders” never bid in round amounts (they don’t bid $10, or $10,50). Instead, they bid $10,01, or $10,51. And they’re all happy about it, because they think they’re smarter than the other guys. And most of the time they are.
But then there’s the guy that knows that trick too, and he bids $10,02 and $10,52… and he gets the item.
AdWords positions
When it comes to AdWords, you know that (in most cases), the higher your ad appears, the better you are off.
Now, where your ad appears is to a large amount determined by the amount of money you are willing to spend. (Quality score comes into play too).
Most advertisers are bidding round numbers… like $0.50 per click, or $0.95 per click. Then there are some that bid $0.51. But with $0.52, you often times get the top spot for a cent more. That’s sweet.
So go into your AdWords campaigns and make those adjustments.
