Posted April 11, 2008 1:59 pm by with 8 comments

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At the end of February Yahoo! Search Marketing announced that minimum bid prices for ads would not be set. Instead the minimum price you pay for each click would be based on value and quality. The changes start next week and will be gradually rolled out.

That means the automatic 10¢ minimum bid will be discontinued. Minimum bids will vary rather than be set. Instead higher quality ads will start paying less per click. If your ad is low quality your minimum bid will be higher. So you can’t buy your way to the top, you have to earn it – with clicks and a valuable landing page.

Improving the quality of your Yahoo! ads, and make them more relevant to searchers, will get you better rankings and you’ll pay less too. Yahoo followed Google’s lead last year when they introduced the concept of a quality score.

If you want to pay less, regardless of your ad quality, MSN still let’s advertisers pay for higher placement – and their minimum bid is 5¢.

  • Well this is only good news for many no? Seems PPC click rates are just out of control these days for various industries!

  • This is a pretty good idea. Does Google have the same system in place? I don’t think so. With Google, you can bid higher and get a top spot right?

  • Dan



    There is a formula set in place that factors in the bid and the quality score.

    you may bid higher, but you can appear lower.

  • We’ll see if this is good or not. I don’t know if I’d say coming to work after Google implemented their QS system and found thousands of keywords inactive was what I’d call “good”.

    The way Yahoo keeps touting the new system sounds like, “YOU MIGHT BE PAYING LESS (but you might be paying more)” and most of the examples in the PDF and PowerPoint they sent over show higher bids.

    Like I said, I guess we’ll see.

  • I agree…there’s no way to tell if this is good or bad until it rolls out. I suspect I’ll see better results on my own campaigns, but who knows. The ranking change could easily be just another way to bump up average CPC for everyone and use quality as the excuse.

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  • Matt

    This is not good news for anyone. Can you say duopoly ? Collusion ? The good news is there is no more minimum bid. The bad news is that the faux quality score will make the minimum bid $0.20+

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