Adwords Bidding Strategy

I have a campaign that has been running for a few days now and i’m breaking even from the campaign. Obviously this is a winner campaign because i am spending $500 to get back $500 in revenue everyday. Logical sense tells you that you’ll definitely need to optimize this campaign in order to make it a winner and milk the profits as much as you can.

This was what i did to make this campaign into a winner.

• Increase bidding for top converting keywords. I know this doesn’t sound logical to you. If you are breaking even now and you bid higher, you would be losing money. Logical emotions won’t tell you to do that and that’s where so many affiliates fail at PPC marketing. They fear losing money. By bidding higher to push your ave position higher up, you will definitely be getting a much higher CTR then before. My campaign was running at 1.3% CTR in the first day and after a few days of optimizing and increasing bids, my CTR is now at a whopping 8.7% now. With such high CTR, how do you think Google will reward me for that? Google rewarded me by giving me a higher Quality Score. My Quality Score increase from all 7 to now currently 8 and 9 for all my keyword and BAM! my average CPC dropped while maintaining my average position. I was losing money previously for a while and now i’m back to breaking even or slight profit. What do you do next?

• Beware!! This is a mistake that i made and you shouldn’t let it happen to you. If you think your next step is to drop your bids down so that you will be profit again, you are wrong. Here’s what i did. My max CPC is now at $0.65 and my ave CPC is at $0.50. I immediately decrease my bids to $0.53 just to stay above the ave CPC, thinking that i will still be able to maintain my bid position. Google saw this and punished me. My quality score dropped from 8 and 9 back to 7 and Google punished my by saying that my bids are too low to be shown on the first page bids of $0.72. WHAT! I was bidding $0.65 previously and getting ave position of 2.7 and now Google is telling me i need to bid $0.72 to be shown on the 1st page. Lesson to learn here. Do not drop your bids drastically once you have spend so much time optimising this campaign.

• My next step is of coz to bid higher then $0.72 to make sure that my ads are shown on the 1st page. Indeed, i lost money again. This time i bidded $0.76 and run my campaigns. I was on ave position 6, and i decided to do a crazy thing. I bidded $0.82 this time to get my position back to the top 3. Indeed, i was in the top 3 position now and my CTR went sky high again. Everything went back to normal after one day. My QS increase to 8-9 and my ave CPC dropped from $0.72 to $0.53 now while maintain a position of 3.2. This time i did not make the same mistake by decreasing bids drastically downwards to $0.53. Instead, i slowly decrease my bids $0.01 at a time a few times throughout the day while checking that ave position still maintains at 3 and my QS is still 8-9. My max bids dropped to $0.64 and i’m still at a position of 3.2 and my QS remains the same. I will continue to dropped the max bids gradually until my cost per conversion is in the green again and my campaigns become profitable.

Tough process isn’t it. Takes alot of time to optimize and this is what i found out via my own trial and error. Hope you guys learn something from this.

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