Google Overcharging Adwords

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Charlotte, NC"Google's Adwords are overcharging and it infuriates me that they are so greedy," says Google customer Gary Kerr. "Their pricing policies are quite Byzantine regarding how they charge for clicks in the bidding process."

As the owner of [ Fine Art Impressions ], Kerr has a daily budget with Google Adwords but his account has taken a nosedive: for the past several months Kerr has noticed unfair and deceptive business practices on Google's part.

"For example, I am willing to spend $0.70 cents for the word 'giclee' (a technological process used for the fine art trade) and if others pay more for the same word, I will be lower on the bidding totem pole," says Kerr. Well, that is fair business practice and it makes sense. "But Google has put a layer of manipulation into this otherwise democratic process," he adds.

Kerr explains:

Google Frustration"It gets tricky: In the past, I placed a bid on words that are made up or unique and I know that nobody else would bid on that word.
1. I type this unique word into Google search and there are no paid sponsors so I bid .05 cents, the minimum bid.
2. The next day I get a notification from Google that my keyword has been shut off from Google Adwords--unbeknownst to me. There is no process whereby I can dispute the action of deactivating a keyword; Google doesn't send out an email.
3. Instead I get this message: 'Your key word bid is inadequate or the Quality Score is too low so you must raise your minimum bid to $.x (which is always higher)".

But I am the only guy bidding! Who says that I have to bid higher when I am not bidding against anyone? Still, Google hits me with these arbitrary price increases. And just for the record, .05 cents can often jump to $5 -- it has been done by a computer but programmed by humans. They are just manipulating the paid sponsor index.

Now I have a choice when Google decides to hold me hostage by deactivating my keyword because they think the bid is too low: to delete the unique word and lose my advertising potential, or increase my bid to their new minimum in order to reactivate the keyword I was sponsoring. Google says the Quality Score is too low for that word so that is why they are increasing the cost. They claim their "scoring for quality is proprietary and therefore cannot be fully explained": how convenient!

(If I get into my account right now, it will say that I have four key words that are inactive—the bids have all been pushed up...)

Stay with me -- it gets even more complicated—this is the part where you lose the jury:

If nobody is bidding on the word, I am number one in the sponsored links. But if nobody is clicking on the link it becomes a low-quality scoring keyword term. Based on the fact that you have a low score, Google sees fit to give you an arbitrary increase in the rate or Cost Per Click. They maintain that they want relevant terms and provide a quality experience for their users, hence the increase in cost.

I emailed Google and asked, 'How do you improve Google user's search results experience when you charge more for that same search term?' That is where it becomes an unfair and deceptive trade practice. As for their response, Google's emails gets quite aggressive. The company has a process to respond that talks down to you—but I know when I am being wronged. When you catch them at this game, they change their reasoning for justifying the CPC cost spike. Their actions are unjust.

What if they change the rules of the NFL during a game? That is what Google is doing here. As you go, they are changing the rules such as "quality of landing page" and other factors to score your search term against the bid cost or CPC. To raise 'per click costs' is where they go wrong. It should be a fair bidding system but it is manipulated instead. If I am the only advertiser interested in a search term, they should not spike the cost of the click, they should be grateful someone is at least bidding for the term at all. But greed and manipulation enters their formula and they raise the CPC for most keywords I am bidding on even if I am the only sponsor for the term.

I have done a lot of research with Adwords and the highest paid CPC is in jet chartering. Type in the phrase 'jet charter' (chances are, you are a wealthy segment of society that charters jets). Now you bid on "jet charter" and the boys at Google understand ultra-wealthy jet charter business. Those bids can be as high as $100-$500 per click. You can see that the value of the click is how they make their money. If it is in fact competitive, then let the market decide the value of the click based on willingness to pay for the sponsored term, but do not raise the CPC cost based on nefarious or hidden policies. It must be fully transparent to the advertiser or it is an unfair and unjust pricing system. If two separate companies colluded to a price fixing system for a specific service, the government would rightfully step in.

Google puts human intelligence into assessing the market value for the value of that CPC rather than letting the value be determined based on willingness to pay or bid for a keyword free of manipulation. Google's stated policy is that if your keyword has a low quality score relevant to your landing page content, then they will charge more for that click. But this is what's really happening: they are systematically forcing minimum Cost Per Click rates up arbitrarily for their own gain rather than let a true bidding system determine price for a keyword.
It goes against the most fundamental tenant of free the enterprise system; supply versus demand.

Here is another example: What will be more costly to sponsor on Adwords: the keyword 'Rolls Royce' or 'Kia'? If there are 20 advertisers vying for Kia and only one for Rolls Royce, the system should be that the Rolls Royce keyword is cheaper than the Kia keyword, essentially a fundamental supply and demand argument. But that's not what will happen. Instead, Adwords will spike the CPC cost for Rolls Royce regardless of market competitiveness for the keyword - it's a pure manipulation.

Google defies the laws of economics.

Google also states that keyword deactivation is based on their own "automatic performance monitoring" system which was of course programmed by humans with a specific goal in mind; optimize revenue for Google, and don't let anyone get away with a five cent click.

The policy of de-activating a keyword because the bid is too low for their revenue target on keywords holds that advertiser hostage by forcing them to pay more to get their keyword ad live again. This cost increase per click is a manipulation of the free market value for a given click. Especially when you are the only advertiser for a keyword!

I explained to my sales rep that Google doesn't have to manipulate the sponsored links, let the market decide the value of a keyword and they will do better based on price fairness in a bidding process. I had a $10 per day budget when I started and well on my way to having a $100 a day campaign. But now I have cut it back—I vote with my wallet. This has all unfolded in the past several months and I find myself a victim—it didn't need to be that way.

Google is well-prepared to deal with the complaints but I will gladly be the star witness."

Google Adwords Legal Help

If you or your company has suffered monetary losses from advertising on Google's Adwords network, please contact a lawyer involved in a possible [Google Adwords Lawsuit] who will review your case at no cost or obligation.

Reader Comments

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I am being ripped off over & over , I set the campaign for a 25 mile radius and set ad to only show where we service and it still was showing all over the country and world . I am also charged for clicks & calls that did not happen like yesterday , I put up a new account and set a $75 day budget, they made sure I had " 44 clicks" to eat up that $ and I also had another page up and that one they charged me for "22 clicks" , I spoke to someone at google yesterday and she agreed with me! That she thinks what they do is unfair also.. I want to start a class action suit for this & against these ripoffs ! Please call me , lets do this ! This ripoff has to stop, no wonder they got so big .

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