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We have given advice on numerous occasions about using an ROAS (Return on Ad Spend)-based approach in setting your initial bids. In other words, don’t just GUESS what your opening bids should be – use some logic to set a bid that will allow you to make a profit, assuming some minimal level of conversions. But once your campaign is running, you need to re-evaluate your bids on a keyword-by-keyword basis.

Over time, you generate solid data that you can use to adjust your bids. But until you have enough data, you need to use some common sense to make your adjustments. The main question you need to ask with regard to each keyword is: what is the likelihood that a person using this keyword will purchase my product or service? If the keyword is a broad, generic one related to your industry, the likelihood of any one person converting who visits your site from an ad triggered by the keyword will be very slim.

However, if the keyword is more specific, that would indicate a higher likelihood of a conversion because the person might be further along in the buying cycle. Therefore, that keyword is worth a higher bid.

Here is an example. Let’s say you sell refurbished laptop computers online. A keyword like “computers” or even “buy computer” is very broad. It is also probably going to be very expensive. You might bid on the keyword to cover your bases, but you would probably bid low and really wouldn’t expect a whole lot from it. But a keyword like “refurbished HP laptop” is much more specific. That would indicate a person who has already decided what he wants (a refurbished HP laptop) and is looking to buy it. For that keyword, you would want to bid more aggressively because of the higher chance of making a sale. Finally, a keyword like “refurbished HP Pavilion ze2000 laptop” would be the best of all because of its specificity. If you happen to have that model of laptop for sale, it might be worth bidding very high on the keyword because of the high likelihood of generating the sale.

If there is anything we can do to help you with your pay-per-click keyword bid management, please contact us at 888-299-4837 or email Info@WorkMedia.net.