Bid jamming and gap surfing

September 6th, 2005

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Late last month I spoke at the “Successful Online Advertising conference in Auckland. One of the questions that came up during the session on paid search was around the tactics of gap surfing and bid jamming. A lot of people in the audience didn’t know the definitions of these terms; in fact, many had not even heard of them before. I’d guess that many of my readers are similarly unfamiliar with these two concepts. So I thought it might be useful to define them.

First off, bid jamming is something you can do in Yahoo! Search Marketing (formerly known as Overture). Bid jamming is when you increasingly raise your bid amount to just a penny below the top bidder who has foolishly set their maximum bid amount way too high. This forces the top bidder to pay that max bid amount per click, whereas you only have to pay one penny more than the bidder underneath you. Of course, this can cost the competitor a lot of money quite quickly but, if you are not careful, you can get bid jammed yourself in the process.

Gap surfing is a tactic for ensuring your bid is no more than it needs to be to maintain your target rank. So if you are happy to be lower than #1 position and you don’t want to pay too much, you might want to use this tactic. In a nutshell, you scan through the top ranking ads and find the big gaps in bid prices and you bid at the bottom of one of those gaps — e.g. the biggest gap within the top five positions.

I would recommend staying clear of bid jamming, and I would employ gap surfing only if you have a bid management tool that supports this capability. I wouldn’t try and accomplish it manually. Particularly since Google AdWords doesn’t even show you everyone’s bid amounts, so you’d have to continually revise your own bid amounts and monitor your position until you figured out the gaps.

As you can see, there is a lot of complexity and subtleties in pay-per-click (PPC) search advertising, and we’re only scratching the surface here. It goes on to include sophisticated web analytics, and constant automated revisions of bid amounts based on the web analytics data (e.g. the technique of dayparting). Trying to manage pay per click campaigns without the proper tools is like showing up at a gunfight with a sword. 😉