Factors to Consider When Budgeting for AdWords PPC Ads

Published: 08th May 2007
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Getting into a pay per click (PPC) advertising campaign with AdWords can be a little intimidating at first because of the formulas involved. Not only must you determine the most effective keywords, but you must carefully evaluate your maximum bid and creatively develop your ad to ensure the level of interest you're looking for

Factor #1: How AdWords Works

Unlike some other PPC marketing companies, Google AdWords uses a number of factors to determine where your ad is placed. Initially, your ad placement will depend on your bid amount for the keyword. After your ad is placed, though, Google makes use of a relevance formula, also referred to as 'quality score'. This means that the more popular your ad is, the higher it will be placed. So even if you are bidding more than your closest competitor, their ad could be shown above yours as Google's relevance system has given their ad a higher quality score. A good online marketing agency will test different ad copy options in order to improve your quality score and help you lower your cost per click and improve your return on investment.

Factor #2: The Keywords You Choose

One of the most important factors in PPC marketing with AdWords are the keywords you choose. Some keywords are more competitive than others, and therefore, high initial ad placement will cost you considerably more. As you make your maximum bid, you have to consider how much you are prepared to pay each time someone is directed to you online. As a result, the ad words selected should be carefully considered because a word or phrase that directs the wrong kind of traffic to your site can be costly.

Factor #3: Your Maximum Daily Budget

One of the benefits of pay per click advertising methods like AdWords & Yahoo search marketing is that your costs are completely controlled. It is easy to set a maximum daily budget. In doing so, you must not only decide how much money you are willing to pay for each click, but also how many clicks you can afford each day. The number of clicks you receive, obviously, will depend on the placement and quality of your ad.

Proper planning is the only way to keep your marketing budget under control. A good digital marketing agency can help you determine what kind of budget you will need for the results you are seeking. From the bidding process for the most advantageous placement of your ad, to the selection of your keywords, to the design of the actual ad, a good agency should be there to help you make the right decisions.

Produced by FirstClick Search. Find out more about our Search Marketing Agency.

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