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Limited budget - AdWords suggests lowering bids

Visitor ✭ ✭ ✭
# 1
Visitor ✭ ✭ ✭

Hello everyone,

Just found something rather puzzling - one of my campaigns has a 'Limited by budget' status, yet I have received an Opportunity which suggests that I decrease my bids by %11, as it will actually increase clicks on my ads.

 

Does this make sense? How could it work out? I attach a screenshot in case it helps.

 

Jordan

 

prtsc2.png

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Accepted by topic author Jordan I
May 2017

Limited budget - AdWords suggests lowering bids

[ Edited ]
Top Contributor
# 2
Top Contributor

Hi @Jordan I,

 

It is not a usual or frequent scenario, however, if it was you would not come to the Forum to post a query ... Smiley Happy

 

Now to give you a simple example, please imagine an advertising landscape where the ads typically showing at the top of the SERP are run by deep pocket advertisers whereas those at the bottom by under-capitalized SMEs. With your current bids your ads have been displaying at the top where clicks are extremely expensive. So much so that your daily budget has not been sufficient to support your ads across 24 hours of the day. (That's why your budget is limited.)

 

If you drop your bids, your ad will only be shown at the bottom of the SERP among the ads run by the under-capitalized SMEs. The clicks you may accrue in this low region will be very cheap and the unchanged daily budget will be sufficient for you to accrue much more clicks than formerly. (That's the reason for the opportunity offered.)

 

Best,

Lakatos

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Accepted by topic author Jordan I
May 2017

Limited budget - AdWords suggests lowering bids

[ Edited ]
Top Contributor
# 2
Top Contributor

Hi @Jordan I,

 

It is not a usual or frequent scenario, however, if it was you would not come to the Forum to post a query ... Smiley Happy

 

Now to give you a simple example, please imagine an advertising landscape where the ads typically showing at the top of the SERP are run by deep pocket advertisers whereas those at the bottom by under-capitalized SMEs. With your current bids your ads have been displaying at the top where clicks are extremely expensive. So much so that your daily budget has not been sufficient to support your ads across 24 hours of the day. (That's why your budget is limited.)

 

If you drop your bids, your ad will only be shown at the bottom of the SERP among the ads run by the under-capitalized SMEs. The clicks you may accrue in this low region will be very cheap and the unchanged daily budget will be sufficient for you to accrue much more clicks than formerly. (That's the reason for the opportunity offered.)

 

Best,

Lakatos

Limited budget - AdWords suggests lowering bids

[ Edited ]
Top Contributor
# 3
Top Contributor

@Jordan I don't suggest you follow the AdWords suggestion always. you should consider your campaign adverting objective first. If your campaign is of direct response campaign. I would not suggest you reduce bid suddenly.

 

Think in this way, you are reducing the bids to get the maximize clicks at the same budget but at the same time your losing the avg position, which @Lakatos has already mentioned.

However sometime, decreasing the positions of ads may decrease your campaigns conversion rate. Hence your CPA will go up high. 

 

Hence, I would suggest you find the keywords which have lower CTR, lower conversion rate, and higher CPC and reduce the bid on them.

 

You can also use the ad scheduling in the campaign and remove some business hour when your campaign does not yield any conversion and gives the conversion at higher CPA.

 

Recommend you to read the below article to manage a low budget campaign.

How-to Guide for Low Cost Advertising in Google

 

--Rakesh Kumar, AdWords Top Contributor , Twitter | Linkedin | Community Profile
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Limited budget - AdWords suggests lowering bids

Follower ✭ ✭ ☆
# 4
Follower ✭ ✭ ☆

Thanks, Lakatos and Rakesh, that's very helpful!

 

I'm currently using CPC for my ads... with this in mind, in your experience, would it be best to take up or decline this opportunity? While the number of clicks would increase, as you explain, would these clicks be inferior in any way? I mean, would the increase in clicks ultimately be worth it?

 

I'd appreciate any advice you could give.

Limited budget - AdWords suggests lowering bids

Top Contributor
# 5
Top Contributor

Based on my own experience of about 10 years - that is specific in many aspects - I represent that clicks coming from lower ad positions tend to convert slightly better and are thus of a bit higher value. A lot depends on the industry of course. The gap was substantial when I promoted travel sites and minimal when it was about some vehicle makes. Chances are it's worth a shot.

 

Lakatos

Limited budget - AdWords suggests lowering bids

Follower ✭ ✭ ☆
# 6
Follower ✭ ✭ ☆

Thanks Lakatos.