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Question about Costs.

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# 1
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Hi, 

 

We're new to PPC Adwords and have a question with regards to the price. We're looking at taking adavntage of an offer sent to us, spend £25 and £75 free. I'm really quite suprised at the cost of CPC, looking at certain keywords that estimate around 5400 searches locally a month and a budget of £0.50 and £5 per day will get me nothing. Am i missing something? After doing research, noone else is using these in campaigns so i will have no competition and yet the Estimater tool is saying i will have 0 clicks per day! 

 

Thank you for any responces, sorry to rant lol

 

Matt

1 Expert replyverified_user

Re: Question about Costs.

Top Contributor
# 2
Top Contributor

Hi Matt, it's a very common mistake to think that if there appears to be no competition then advertising should be very inexpensive.  Google applies quality controls to all advertisers and these normally force a certain CPC regardless of the competition.  This is just the same with traditional advertising; Yellow Pages don't charge you any less for being the only company of your type in the book Smiley Happy

 

It's a bit of a soapbox of mine that you shouldn't really think of AdWords - or any advertising - in terms of "cost".  Advertising has a purpose, usually to promote a product or service, and a typical measure of success for that purpose is that the campaign returns a positive Net profit.  If the campaign is successful and has a returned a Net profit, it really doesn't matter whether you're spending £50 or £50,000 a month.  If the campaign is not successful - and there's nothing you can change to make it so - then you shouldn't advertise in that fashion and your spend will become 0.

 

The key issue is more how you approach the initial advertising to determine its likely success rate.  You don't want to throw £50,000 at a campaign, spend it all in a week and find it's not a success, so it's best to start small and do a limited test run for a few weeks.  It may well be that to get enough data to be worthwhile you'll have to allocate a decent budget for this test and accept the possibility that it will be written off if unsuccessful.

 

I'll add a final word of caution.  If it appears that no one else is advertising your sort of business with AdWords, this doesn't usually represent an opportunity, it is more likely to indicate that advertising in your sector is difficult or typically unprofitable.  If this is backed up by higher than expected CPC figures (as sounds the case for you) this just underlines that opinion.  If you decide to proceed, I would do so with caution.

 

Jon

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