Why is there a PPC arbitrage opportunity? My understanding is that long-tail keywords (i.e., very specific ones) tend to cost less than more general keywords, thus creating an arbitrage opportunity via landing pages. Why do genuine advertisers not bid up the price of these more specific keywords and equalize the price of the keywords? How long do you think the arbitrage opportunity is likely to last? Thanks!
AussieWebmaster
02-06-2007, 05:31 PM
Why is there a PPC arbitrage opportunity? My understanding is that long-tail keywords (i.e., very specific ones) tend to cost less than more general keywords, thus creating an arbitrage opportunity via landing pages. Why do genuine advertisers not bid up the price of these more specific keywords and equalize the price of the keywords? How long do you think the arbitrage opportunity is likely to last? Thanks!
There is a lot more to arbitrage than the tail.... some people grab cheap terms in an industry and land them on pages optimized to pull the more expensive terms in the industry... the visitor finds some of what he wants and then clicks and the arbitrager makes a profit.... grab 10 cents words and the ads on a page are paying you say 80 cents... only one in 8 you buy has to click on an ad... higher and less....