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Earlier Yahoo Search Marketing had a fixed minimum bid of $0.10. Now, the Yahoo Search Marketing network has announced that it will not continue to have a fixed minimum bid anymore. The minimum bid will be set based on quality and value rather than how much you pay. According to Yahoo, the setting of minimum bids will be based on individual keywords.
Yahoo said "Following the auction model, we are changing the way we set the minimum bids required to participate in a Sponsored Search keyword market. We will start calculating a variable minimum bid for some of the keywords you're bidding on".
Earlier, the minimum bid never fell below $0.10. With this change you could pay less per click. Yahoo is changing the fixed minimum bids so that now the new minimum bids can be lower or higher than $0.10. Additionally, Yahoo also said that this change will not affect Content Match minimum bids which will be the same as $0.10. So now the minimum bids will be on the basis of the relevance of ads to a keyword, the number of bidders and their bid amounts and definitely not based on advertiser conversions.
There are many factors that makes a minimum bid go higher or lower.
The two main factors are - Value and Quality.
- Value depicts the number of bidders and their bid amounts in a particular keyword market.
- Quality depicts the relevance of keywords, or how frequently users click on the ads associated with them relative to competing ads.
Yahoo says "A keyword term becomes "active"or switched "on" in the system and becomes eligible for display, when your bid is equal to or greater than your minimum bid. Keywords become inactive when your bid falls below your minimum. You will be notified in an alert on your Account Dashboard if your bid is about to drop below your minimum, and you'll have a grace period of up to a few days to raise your bid to keep your keyword active".
Yahoo also made an announcement that now the new advertisers can find keywords that are below the minimum bid by using the new search tool that has been introduced recently. Yahoo has given assurance to advertisers that as long as ads don't drop in quality, most of the minimum bids will not vary dramatically over time.
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