Pay Per Click Bidding: First Gap Bidding

Posted: May 1, 2002

This bid strategy is to find the highest position at the lowest price.

The pay per click bid manager will look for the first gap equal to $0.0x (where x is defined by you. Usually a gap is from $0.05-0.10, but you can customize your own gap price depending on your competitor strategy).
Your bid will then be placed in the gap so you will only be one lower position than someone bidding much higher than you, but you will be paying only $0.01 higher than the next lower person.

Position	1	2	3	4	5	6
Bid	$1.00	$0.98	$0.97	$0.75	$0.23	$0.22

The first gap appears between advertiser 3 and 4. Your bid will be placed at $0.76 which means you’re paying $0.23 less than position 3, and will occupy the 4th spot.

This is a good bidding strategy if you are looking for a lot of exposure, and willing to pay for it, but are looking for a lower overall price.