I was reading this post by Andrew Goodman this morning regarding the history of price increases in Google Adwords and their correlation to quality score and the quality updates. This was brought about by all the recent conversations regarding the new adwords landing page quality update that just happened but it got me thinking about where the line will be drawn.
If Google is not careful they will update and price themselves right out of the PPC business. Their are arguments that these quality score updates have been used to clear out the riff-raff and the affiliates who use Adwords to drive traffic but credible advertisers have also felt the burden of the updates and price increases. For these affiliates who have been squeezed out, as the prices of keywords increases their margin decreases until a point where they are no longer profitable. Well this same theory can be applied to non-affiliate advertisers. If Google keeps “updating the quality score” algorithm or what it is referred to around the industry as the Google Money Grab update there will be a line where keywords will be too expensive to for advertisers to profitably use Adwords.
I’m sure Google currently views Adwords as a bottomless money pit but they really need to find other ways to implement quality assurance rather then jacking up bid prices. With these updates and the lack of attention it seems they are putting on the click fraud problem, this bottomless money pit will not last forever.