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SOS, Pay more or Pay less?

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# 1
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I have a campaign running on CPA. Also, I already know my earning per conversion.


So, lets say...


Earning per Sale: $100


So, if I set the CPA bid on $50 and of course it convert at $50, I will have a 100% of return. Invest $50 and I get $50 in "my had".


If I decided to pay per CPA bid $70, I will have MUCH sales but less return.


But now, If I decided to spend $30 per CPA, I will have MORE return on investment but LESS sales.


Which is the balance on it that I have to pay per CPA to get more profits at the end of the day?


Higher CPA, more sales, less return. But 10% of Return of a BIG number is better that  200% or return of  a very small number.


Now I understand why my mother said that I had to study at a university!! lolololol


HOPE all of you understand what I need to know.


I don´t care how much spend, much or less, but what I obviously want to know if what CPA do I have to set to get  more earning at the end of the day.


I know that there is a limit on quantity to clicks that I can get from Adwords for a specific Search Campaign. 


I have been trying to get always a 100% of investment, so I decided to pay $50 conversion. $100 sales - $50 advertising cost= $50


Adwords offers any tool for it? something that I am messing?


Thanks to all in advance.



















1 Expert replyverified_user

Re: SOS, Pay more or Pay less?

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# 2
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Hi @Isadora R,


10% of Return of a BIG number is better that  200% or return of  a very small number.


I agree with it completely. Now, when you have been experimenting with different CPAs, you are on the right path already. Just two suggestions from me -


Once you give it a certain CPA to optimize your ads around, give it sometime respond and optimize properly. Sometimes, making frequent changes only confuses the system. 


Also, make sure you don't leave everything to CPA bidding only. Keep optimizing your campaigns. Like - write more targeted ads, enhance landing page experience, fine tune extensions.. and so on.


To sum up, while a lower CPA may mean higher returns on individual sale, but it does not necessarily mean higher sales volume. You should aim higher sales volume at comparatively lower returns as you have already been doing. At the end of day what matters the most is how much you earn, not how much you paid. And, earning can be increased by increasing the sales volume even at the cost of comparatively higher CPAs. Obviously, by increasing sales volume. 


My two cents. 


Ratan Jha


About Me: Community Profile | Ratan Jha INC.
If this or any other post solved your question, do not hesitate to accept it as the solution.

Re: SOS, Pay more or Pay less?

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# 3
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Thanks Ratan for you advises.

Is there any tool from adwords so I can knwo how much to pay for get the MAX profit of my campaigns??

Exactly, how can determine the CPA from a MAX Profit?

There should be a balance.