Ok lets say you have some decent ads now that are pulling a decent CTR (Click through rate)

Lets say that the ad groups are organized correctly so you are able to expand and are not shooting yourself in the foot.

The next step, once you have some decent ads that are getting at least 1% CTR or more, is to start RUTHLESSLY cutting your Cost Per Click. I have been amazed at how much you can start cutting your costs once you have that good CTR.

Just reduce your CPC (cost per click) by 10 cents each day until you are down around position 4,5, or 6 and your clicks are a little smaller, but not that much smaller. I am in position 4 or 5 in a lot of places, paying maybe 25-50% of what my competition is all the time.

This strategy isn't for everyone- If you have a site that really performs well, or you have deep pockets, by all means go ahead and spend the extra money and be number 1- You will get lots more clicks. You can still reduce your costs to be number 1 or 2 by testing better ads and reducing the price on a gradient. And you can still get the benefit of reducing your costs to be up there by 20% or so. And you will be amazed how many times you can lower your CPC and it doesn't affect your position at all!! You have to have established, high performing ads to do this though.

But I am very ROI driven, so I have found better results by simply dropping the price, dropping the position, and increasing my daily campaign budget. I have also found that being number 1 is great for the ego, but the traffic just isn't as targeted. The serious searchers go a little deeper into the first page of search results because they are hunting something down. If my ad is just a little better then the top 3 or 4, they will click on my ad, and they are the searchers I am looking for. A lot of general searchers look at the first 2 or 3 Organic listings and maybe click on the top ad or top organic spot, and off they go, but they often have a more general interest or are doing research. Whatever the reason, I have found that I am getting a better conversion rate by actually being lower on the page than being number 1.

In super competitive industries this strategy won't work, but there are lots of traffic bargains out there still, and lots of niches where this works just great.

-Steve

Steve Blom
Certified Google Adwords Professional

Adwords Training Video Author:

Blog:
http://marketingnewsblog.adwordstraining.org

Free Adwords video:
http://www.adwordstraining.org/video/free_adwords_tutorial_video.htm

Contact: steve@adwordstraining.org