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how do i know how much to pay for ads - I obviously want to get the best ranking but spend the least

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# 1
Visitor ✭ ✭ ✭

My campaign is running but competitors are showing up higher than myself. I know google recommends a certain about but sometimes seems very high. I want to spend the least amount but acheive the best results - Any recommendations?

1 Expert replyverified_user

Re: how do i know how much to pay for ads - I obviously want to get the best ranking but spend the l

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# 2
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Dear Vance,

 

This can depends on many things why your competitor is showing above you. Consider creating a relevancy between keywords and Adds, you might also want to raise your bids if your budget allows you to do so.

The best way to minimize your bids while achieving top results is to keep your relevancy high (by creating more adgroups with relevant keywords) and increase your CTR(your adds are closely related to your keywords, so the user find what he search for)

 

hope this helps

 

Thanks

 

Tabish

Re: how do i know how much to pay for ads - I obviously want to get the best ranking but spend the l

Top Contributor Alumni
# 3
Top Contributor Alumni

Good morning - 

 

The fact that other ads are appearing higher on the search results page than yours is not necessarily a bad thing. Not all competitors can afford for bid for the top spot. Obviously the higher on the SERPs your ads appear, the more clicks they're going to get, but the cost of getting those clicks might make your campaign unprofitable. What really matters is--is your campaign producing the results you need from it, at a cost (ROI=return on investment) that works for you?

 

As already suggested--work on performance. Make sure your keywords are in small, tightly themed Ad Groups. Write ads that speak to the theme of each group and keep testing new ad variations to try and improve the number of clicks you're getting on your ads. Check your website landing pages--make certain you're using the best page on your website for the ads from each Ad Group. If there isn't a good page, make a new one for that Ad Group's "theme."

 

The bids that the AdWords system recommends are just very rough estimates. If it's not cost-effective for you to bid in those ranges, focus on performance quality. Make certain that your ads are being shown to the best/most appropriate group of searchers and that your website does all it can to convert those visitors to customers.

 

Good luck!


Theresa
Google AdWords Top Contributor
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Re: how do i know how much to pay for ads - I obviously want to get the best ranking but spend the l

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# 4
Explorer ✭ ✭ ☆

First thing to do is make sure your Quality Scores are adequate. Seven and above (and of course, preferably ten) is what you want before increasing bids. Otherwise, it just makes it that much more difficult and costlier. Optimize your landing page as well for higher conversion rates.

 

If you have great QS, you want to be as close to the first position as possible. Why? Because that's where your CTR will be highest. It should be obvious that most people will click the top ads most often just as they click the top listings more often. More clicks equals more sales.

 

What often happens as well is that visitors will buy more often from the top ads as well. Not always but often. I know it seems strange but it's true. I have a client who is converting at over 10% in first position and quickly goes down from there to 3% in second and just a few percent in third. I see the same for most other clients, although rarely to that same extreme. In other words, you maximize visitors and sales in first position.

 

Now, you may be thinking "but my CPC will go up too". You'd be surprised but in most cases, not really and the first position often has a lower CPC than the next few positions. The client above, the CPC is virtually the same in all positions down to the fifth with very little variance. But because of the higher CTR and conversion rate in first place, the ROI is at it's best there as well as resulting in more conversions per impression or per 1000 impression.

 

You'll have to test if you follow this trend. It may be that conversions are the same in any position. In that case, just be happy being in the middle of the pack if that's what your budget allows. But normally, you'll still want to be first since you'll have more clicks (visitors) and therefore more sales.

 

Sometimes, you don't mind being second or even third. I've seen competitors with what appears to be poor ads (and therefore poor QS) but want to be first so they bid very high, higher than the going rate. I say let them. You get a bit less clicks in second position but in this case, at a much lesser cost and if conversions are the same, your ROI will be better. You can see all this when you dig into the data. You just have to find the nuggets and adjust the campaign to maximize your profits.