Can someone explain to me how Google AdWords comes up with the suggested maximum cost-per-click when you're first creating an Ad Group? Also, in the "maximum cost-per-click" table/step, why does the estimated Average Position sometimes *increase* if you lower your maximum cost-per-click?

More broadly, can you put much faith in what these suggestions/estimates tell you or should you just insert a "starting bid" within your budget's comfort range and adjust later based on actual numbers?

Thanks.

Hello KeywordHelper,

That suggested max cost per click is a joke.

For me; Google's estimates have never even been close, they always seem to dramatically overestimate, but you should always make sure that you are working w/in your budget just incase, and then increase later.

Bottom line: I wouldn't trust any of their estimates.

__________________
Consumer Comparison Info - Online Product Review Site

Hello KeywordHelper,

That suggested max cost per click is a joke.

For me; Google's estimates have never even been close, they always seem to dramatically overestimate, but you should always make sure that you are working w/in your budget just incase, and then increase later.

Bottom line: I wouldn't trust any of their estimates.

__________________
Consumer Comparison Info - Online Product Review Site

I have to agree with Sanjo. Those suggestions are a joke. We've had some that they say to bid well over $4.00 for that we get the #1 spot for under a quarter. Maybe it has to do with click through rates, but that'd be pretty drastic.

In any event, just do what makes sense for you from an ROI standpoint and let the rest take care of itself.

Look at your average conversion rate, then figure the correct CPC to acheive a profitable ROI. If you don't know your conversion rate, then start tracking it now so you have a better idea in a few weeks and can make adjustments. Also, make sure to use at minimum their conversion tracker, and a 3rd party utility as well if you can afford it. Track every word as closely as you can, making adjustments every day for a while, then gradually slow it to every couple days. Just keep an eye on it.

Best of luck,

Brian.

__________________
ToolBarn.com, an Internet Retailer Top 500 and Inc. 500 Company | Tool Parts | Pet Supplies

I have to agree with Sanjo. Those suggestions are a joke. We've had some that they say to bid well over $4.00 for that we get the #1 spot for under a quarter. Maybe it has to do with click through rates, but that'd be pretty drastic.

In any event, just do what makes sense for you from an ROI standpoint and let the rest take care of itself.

Look at your average conversion rate, then figure the correct CPC to acheive a profitable ROI. If you don't know your conversion rate, then start tracking it now so you have a better idea in a few weeks and can make adjustments. Also, make sure to use at minimum their conversion tracker, and a 3rd party utility as well if you can afford it. Track every word as closely as you can, making adjustments every day for a while, then gradually slow it to every couple days. Just keep an eye on it.

Best of luck,

Brian.

__________________
ToolBarn.com, an Internet Retailer Top 500 and Inc. 500 Company | Tool Parts | Pet Supplies