I have a competitor in my business sector that has set very high first position bids. Most of them are over $40 per click. I do not have the budget to compete with these high bids and I know my service is better then the competitors. Is there a way to combat this/compete with this? I know who the competitor is and I know that they do not have the budget to sustain those high bids for a long time.
Since my page rank is normally around the second position I had an idea. If I were to set my bids at $30, the competitor with a bid higher than $30 would have to pay that to stay higher ranked correct? I know that the competitor could not sustain $30 per click when there are hundreds of clicks a day.
Is there a flaw in my thinking? Is there something I am missing? Does anyone have a recommendation or a plan to compete with a very high bidder? I look forward to hearing from someone.