Google gets back to the basics to explain Adwords Auction

Google has introduced adwords auction that basically works on the principle of quality score. However, people around the planet where unaware of this adwords option. Even if people have phpThumb copy.jpgheard of adwords auction, they do not know what it is. Finally Google has decided to get back to the basics to explain the Adwords auction. According to Austin Rachlin of Google AdWords, “When people think of an auction, they often think of a prize being sold for the highest bid”. Things are very different in the case of adwords auction. Here the winner of the auction pays the minimum possible amount to maintain their position in the page. This is quality based pricing system, “This ensures that you'll often pay less than your maximum bid” says the Google Adwords authorities. This concept is explained in detail by Google’s chief economist Hal Varian using a very interesting video.

Here is Hal explaining it for you

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