Question
Moran is confused why the cost per click for a display ad on Facebook is about $1.72 whereas it takes about $2.32 to win a
Moran is confused why the cost per click for a display ad on Facebook is about $1.72 whereas it takes about $2.32 to win a keyword auction for "iced tea" on Google AdWords.
a) Use the customer journey concept to explain why this might be so?
b) Moran estimates that for every 100 customers who click on a Google AdWord ad for iced tea placed by Sagacity, it realizes one case sale at $2.70 per bottle. The estimated variable costs are about $15.00 per case. What is the maximum price she might be willing to bid; i.e., what is the value per click of the search ad?
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