Most advertisers want to be in the number 1 spot on Google AdWords. The problem is there can only be one number one ad and a lot of businesses are trying to get there.
I have a lot of clients ask me how much it will cost to get the top spot on Google AdWords, thinking there is some special number. Unfortunately, there isn’t a set amount and even after you reach number 1 things constantly change. Sometime not for the good.
I had a client call recently because their daily budget was used up and it wasn’t even noon. The reason was that while they usually paid 13 dollars a click for a phrase, on this day it cost 65. They had one fifth the usual clicks and little to show for the money spent.
The reason is that had raised their max cpc to over 100 dollars for that phrase. They’d done this in the past (against my advice), but it never had never had these results. I explained to the client that he should never set the budget that high. Yes, that bid guaranteed him the top spot, but there was also the chance that this is what it could cost him to get there. All it takes is for one competitor to bid up to 64 and there bid would automatically become one cent higher. Which is what occurred on this day. If they’d bid to 99.99 they’d have spent 100.
I have clients who do spend 65 dollars a click on some phrases and make a high profit on their campaigns. This client wasn’t one of them. What I asked them is what amount could they still make a profit at and never go past that number. That didn't mean they couldn't eventually become number one. Things change as a day progresses. The budgets of competitors are used up and others only run ads during certain parts of the day. So being fourth in the morning could be a top spot later in the day.
It’s Not How Much Does A First Place Listing on Google AdWords cost, but what is it worth
When developing a budget for your Google AdWords campaign, factor in what is the most you’re willing to spend for a click. Factor in not just how much you’re willing to pay for a click, but also how many clicks you have before you have a sale. If one out of 10 clicks results in a sale, then you’re actually paying 10x what you think you’re pay for a click.
Then factor that against how much profit you make on a sale. If the numbers don’t add up, then lower your bids. And then develop a new strategy.
The best strategy is to target a number of words. Unless you sell a very specific product that people only search for using phrase, there are other options. Often people make two crucial mistakes. They target two word phrases and the phrases that have the most traffic. Yet phrases that are longer, but have lower numbers often represent more targeted traffic. Focus on enough of these and you’ll end up with traffic numbers close to your targeted phrase. And cost less.
When you set your bid for a keyword, think about what is the most you’re willing to pay for that phrase. Often you won’t pay that, but if new competitors come into your market or your current competitors raised their bids you could. Don’t wake one morning and find you’ve paid an astronomical amount for a single click.
If you're concerned about getting the most out of your AdWords campaign, then consider hiring a pay per click consultant