[I see people in the main forum talk about 1%, 2% and sometimes even less being great conversions, I would lose my pants with conversions that low paying $10 per click with a $100 product. I really can’t see how 10 different people, all selling similar products at similar prices are all making profits using AdWords paying $8-$10+ per click.]
First, let me say that your Quality Score has a lot to do with how much you pay. If you have a high QS and your competitor has a low QS than they may have to bid several times higher to win the same ad position.
Secondly, some of your competitors are likely selling a higher ticket item and they may be able to afford a much higher CPC and still remain profitable.
And finally, you may be in a highly competitive niche that has attracted lead brokers. A lead broker can generally afford to pay a much higher CPC and recoup the cost by reselling the same lead many times over.
