should I lower my cpc bid on adwords, help?

[robert11]

I have one campaign running that is doing ok and I am about breaking even with it. My current bid is .16 and it is averaging the 2nd ad position. The diagnostics tool says I can have a min bid of .05 to be on the first page. Do you think if I lower my bid, it will hurt the campaign and I will get fewer clicks and a lower click thru rate.

Thanks

[dburk]

Hi robert11,

Do you have multiple keywords? Multple ad groups? Are you tracking conversions and do you know what your earnings per click is averaging?

I certainly advocate testing your ROI and total profit at various bid levels. If your CTR remains the same or better when you lower you bids and your impressions don't drop then that would be good. If these numbers change, and they likely will, you need to understand how this impacts your ROI and especially your total profits.

If you don't have a way to track your earnings down to the individual keyword level, I would seek to to do that first, before you begin experimenting with different bid prices.

[BGold]

Originally Posted by dburk

Hi robert11,

Do you have multiple keywords? Multple ad groups? Are you tracking conversions and do you know what your earnings per click is averaging?

I certainly advocate testing your ROI and total profit at various bid levels. If your CTR remains the same or better when you lower you bids and your impressions don't drop then that would be good. If these numbers change, and they likely will, you need to understand how this impacts your ROI and especially your total profits.

If you don't have a way to track your earnings down to the individual keyword level, I would seek to to do that first, before you begin experimenting with different bid prices.

Great Advice!
I would suggest sign up to Perry Marshel's free "5 days with Google Adwords" newsletter. Sometimes simple tricks help alot.

Check if you have any keywords that are doing particularly well. Take those keywords and put them into an ad group on its own, see if that works better with a lower CPC.

Test, track and test!

Good Luck!

[jmidas]

I've had my best luck and best ROI being in the 3-6th spots. After making most of my living from the results of adwords since 2001, I honestly see no benefit of being #1 or #2 - especially if it costs quite a bit more. In our case, it is the difference between about $2 and $.40 so you must measure ROI as well as raw clicks. We actually have not found a drop off in clicks, either.

So, my advice is (like many others) test it. You may be giving up .10-.11 a click for no reason.

[dburk]

Originally Posted by jmidas

I've had my best luck and best ROI being in the 3-6th spots. After making most of my living from the results of adwords since 2001, I honestly see no benefit of being #1 or #2 - especially if it costs quite a bit more. In our case, it is the difference between about $2 and $.40 so you must measure ROI as well as raw clicks. We actually have not found a drop off in clicks, either.

So, my advice is (like many others) test it. You may be giving up .10-.11 a click for no reason.

Hi jmidas,

While in most cases your advice would be correct, it certainly is not true in many cases. I have found certain industries that have dramatically better ROI on the number 1 position and I have seen many that have the best ROI on really low positions like 17 or 21.

If you're smart, you'll focus on maximum profit which is almost never the same as maximum ROI. Would you rather make $400 a month on a $100 investment, or $40,000 on a $29,000 investment each month?

Why test when you could know? Test and track!

[brettkbrett]

maybe try lowering it a bit and geting in the 3-4 position... that really is a great cpc you just need to work on optimizing your landing page.