Pay Per Click Bidding - Gap Jamming

May 1, 2002

Price pinning is also known as gap jamming. This strategy is used in conjunction with first gap bidding. It’s most commonly used with Overture auto bidding.

Your pay per click bid manager will look for the appropriate gap, and then only bid $0.01 below the highest competitor in that gap.

An example:

Pay Per Click Bid Prices:

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

This example is for gap jamming with first gap bidding. The first gap is between advertiser 3 and 4. Regular first gap bidding would place your bid at $0.76, meaning advertiser 3 would only pay $0.77 for their bid with auto bidding enabled.

Gap jamming would place your bid at $0.96. This would cause advertiser 3 to pay $0.97 and you to pay only $0.76 ($0.01 above the next lower bid).

This is a useful technique to force advertiser 3 to either lower their bid, thus getting position 3 for less money (and can be used in many instances to lower overpriced bids) or to have their account used up quicker, thus forcing their account offline, and you taking the number 3 spot for the price of the number 4 spot.

With this technique, it’s best to update your bids often as advertiser 3 could lower their bid by $0.02, which would price pin you, and they would be paying the lower price for high exposure.

This technique has a lot of benefits, but can cost you if you are not careful, so know your competition and bidding strategies well before attempting this pay per click bidding strategy.

Related Information:

« Pay Per Click Bidding: First Gap Bidding

Pay Per Click Bidding - Largest Gap Bidding »

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