Your Google Keyword Is Always On The Auction Block

Google keyword auctions explained: 2 minute video

Need a better handle on how keyword “auctions” work? Take two minutes and check out our first video blog and learn how Google weighs your bid with your web experience to decide whether you come out on top.


Welcome to our video blog series of FAQs about paid search advertising for people like you. I’m Brian O’Grady from Search Warrant Online Marketing. Buckle up. One of the most common questions that we get when we’ve started an ad campaign or are talking to someone about starting and ad campaign is, “well, what do you mean I don’t own my keyword?” I paid for it, I went and I bought it, it’s like a stapler, right? I bought it, it’s mine.

It’s not like a stapler, it’s an auction. And that’s one of the more challenging bits to understand in paid search advertising. Once you get it, it sinks in. But the first time around, it’s a little strange. You don’t actually just buy and pay for your keyword – you bid on it. And you bid on it lots and lots of times throughout the day. Because it doesn’t just happen once, that someone goes searching for your keyword, it happens – hopefully – lots and lots of times throughout the day in lots of different places.

And each time, you’re bidding to win an auction to be the person who gets to advertise for that keyword. And sometimes you win, and sometimes you lose. If it’s an auction and I don’t just own a keyword, that means I should be able to just bid on a keyword higher than anybody else and I’ll win every time. That’s not exactly how it works. There’s another side to this kind of auction in paid search advertising. It’s not just how much you bid, it’s also what kind of web experience you’re offering your user.

So, search engines actually have a vested interest in not just doling out their ads to the highest bidder, because it doesn’t provide the best web experience. Instead, they want part of that auction to be the web experience that people are enjoying the most and are finding the most useful. So, you combine that web experience, as measured by the market behaviour, with the bid that the market is willing to provide. Those two things together decide whether or not you win each and every individual auction.

You shouldn’t worry too much about the fact that you don’t own a keyword. What you should be more focused on, in my opinion, is what are the results you’re getting for your marketing dollar.