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And what others are doing should not matter.
You choose to accept the "rate card" presented to you by adwords from their formula OR you can place an amount in the little box that is accepable to you and wait for the "rate card" to change. It may or may not change. But you can only pay what you can afford to pay.
So think long and hard about the 25/35/35 (Title and Description) and don't waste the budget on unwanted visitors.
And what others are doing should not matter.
What my competition is doing ALWAYS matters.
However, my client wants to know what the top listings are costing.
Hmmm, its a combination of max cost per click + CTR that gets an ad listed highly - isn't it? If so, then it is not possible to say what a position costs, ie: the position = budget x creativity.
Is that right?
The obvious benefit of having an ad in the top 3 is that your ad will get syndicated to show on AOL, so dependant on your model B2B or B2C it might be wortwhile to aim for a top 3.
There is also the averaging effect, whereby you might say to Google "I want to pay 50 cents and for that you suggets your ad might be in 3r place say. When you start to check you find a lot of the bids seem to be 80 cents and you wonder what has happened, did someone spill a drink on the server... What happens is Google will ensure that over the course of the month your average cost per click will be 50 cents, so you will get cheaper ads in due course.
On competitive keywords Google will show up to 10 ads per page, if you see a page for a search term with less than 10 ads then the cost for advertising shouldn't be too prohibitive.
However, there is also the old legacy Adwords advertisers to consider, which is why often you think you should pick up traffic cheaply but it says your minimum price is 60 cents. This is because the old CPM advertisers have contracts that need to be honoured and selling you CPC for less than this amount would give you preferential treatment.
Minefield or what!
