No, it's not. Not for a profitable PPC campaign, anyhow.
You need to figure out a bid price that makes money for you, and be guided by your own numbers, not by what the competition is doing.
The people with the most profitable (and sustainable!) PPC campaigns are NOT necessarily those in the top few positions, or those trying to play mind games with the competition.
Regarding high CTR Adwords ads, I don't know if seeing such an ad would teach you much unless you could also see the keywords that were driving traffic for it. I recently was asked to help with someone's Adwords campaign. When I got into their Adwords account I was astonished to see the CTR's they had achieved over a period of two months ... ranging from 20% to 50%. However, all was not well. The account was full of multi-word phrases along the lines of "foreign widget repair parts for sale", "buy foreign widget repair parts" and so on... exactly on target, but the wording was too specific to generate many impressions.
I kept the same ad and left their terms in place, but added a new ad group full of more general terms, along the lines of "widget repair" "repairing widgets" "fix widgets" and so on. The concepts were a good match but the vocabulary was more general and the phrases shorter. The CTR for the terms I added was 1% or 2% (for the same ad, remember). That doesn't sound like progress, but it was. Because the number of impressions went up dramatically, they were getting 25 times more traffic from their Adwords by the time I handed the account back to them. That was without raising their daily budget.
If you in a war with your competiton you might really want to cost them lots of money. I'm sure Google loves these battles ;)
We had a guy start his own business inside our company in competiton with us. He even hosted it on our server! Needless to say, once we fired him and he opened up shop our target at least initially was to totally obliterate him.
My point is, if you think you can drive a small man out of business before he gets big enough to compete with you you might want to do it.
The end of the story? It's 2 years later and he's still there and we forgot about him. Now we play Buckworks' game ;)
A WARNING headline. Like:
KEYWORD Dangers Exposed
An EXPLANATION. Like:
Avoid getting burned. Get all the
facts. Full WIDGET info here. Rep.
Url should contain widget name
if possible.
Rep is what you tack on if an affiliate.
Otherwise:
Get full WIDGET info now.
Upside: Good CTR.
Downside: Alarmism jogs curiosity,
may not convert to sales.
So:
Widget site needs to be very good
and Widget needs (in my case) to
get repeat sales.
Hope this helps a bit. Cheers, S
[edited by: Shak at 5:02 pm (utc) on Sep. 7, 2003]