Think about this: When you go to buy a stock, you know the last purchase price, the volume of shares traded and the type of shares being sold — among many other things.

Now when you buy a keyword or key phrase at “auction” on Google or Bing or any other search engine, you know nothing, zero. After awhile of spending money and watching closely you can gauge how much you need to spend to get to your desired position. BUT…

You don’t know

• The volume of clicks.
• The latest bid.
• What is being purchased (exact, phrase or broad) among many other items.

Yes, Google rates your ads and landing pages, but they don’t tell you HOW they are rating them. And they are allegedly applying better pricing to better ads — but what does that mean? We really don’t know their parameters.

Imagine buying a stock and not knowing the last tick? Or the trading volume?

You wouldn’t participate would you?

Google’s closed auction is much more akin to a Vegas gambling game: the house ALWAYS wins. Scott Cleland over at Precursor.org doesn’t even think it should be called an auction at all. “If Google were interested in fair representation and truth in advertising, Google would represent Adwords as Google’s algorithmic secret selection process or GASSP.”

I love the acronym, because that is exactly what advertisers are doing right now gasping for breath as prices go ever higher and Google Adsense makes less sense than ever before. Yes a searcher is the most motivated buyer on the planet BUT the value of that click depends on your product price point, conversion rates and margins.