The AdWords keyword bidding strategy you choose to implement will depend on what goal you have set for your PPC program. Higher bids are likely to result in higher rankings and more impressions for your ads, but your cost-per-click will increase. Low bids will result in lower rankings and less impressions but your lower cost-per-click will lead to more visitors per day. The best strategy for your business may lie somewhere in between.
Let’s take a look at the positives and negatives of each strategy.
Building your brand with high bids and high rankings
If you really want to build your brand using AdWords, having a top ranking may be very valuable to you. Increasing your bid so that your average ad position is between 1-3 will mean that you’ll often appear on the left side of the search results page above the organic search results. It’s very likely that even though not all searchers will click on your ad, most will at least catch a glimpse of it. Over time, these impressions will add up and help you build brand recognition for your targeted keywords.
The obvious downside to this strategy is that you’ll be spending more per click to achieve a top ranking. Keep this in mind when setting your budgets as you can quickly chew through a budget for popular keywords when you ad has a high ranking.
Once your budget has been expended for the day, your ad will no longer show for the rest of the day, meaning that you’re no longer reaping the brand building benefits that you were hoping for. One way to combat this from happening would be set your ads to only run during the times of day when you think it is most likely that your target audience will be online. This way, you are maximizing your brand’s position at the top of the rankings.
For instance, if you are selling services to homeowners such as landscaping, it may make sense to maximize your presence in search during the evenings and weekends when it may be more likely for people to conduct such a search rather than during the work day. You can test these theories and tweak your campaign for maximum exposure.
Quantity over quality with lower bids
If your goal is simply to bring in the most total clicks to your website over the course of the day, a lower bidding strategy could be the way to go. Targeting a lower average position such as something in the 4-6 range means that your ad is unlikely to show up above the organic results, rather it will appear in the right hand column of the search results.
Your ad won’t get quite the number of eyeballs on it that it would have in a higher position, which will likely mean a lower click through rate. This does have an upside though because since you’ll be paying less per click and your ads are clicked less frequently, you can likely stretch your budget out through a much larger portion of the day. This can allow you to catch the eye of potential targets you may have missed using a higher bidding strategy.
Testing, testing and more testing
The great thing about AdWords is can always test your campaign and make tweaks to ensure optimum performance.
In the example below, we are looking at the average time spent on the website for a visitor who clicked on a particular ad in various ad positions. Interestingly, the very top position did not result in very much time spent on the site on average. This particular ad performed much better in position number 3. Analyzing this type of data can be a great way to optimize your AdWords campaign and save significant dollars in the process.