My keywords are for niche industrial products, so it's not like I'm in some hypercompetitive web space like mortgages or credit cards.
Anyone else seeing the same phenom? Any recommendations for inexpensive alternatives to Adwords?
that 0 ROI threshold
Sure you can't raise the threshold. Survival of the fittest.
Yes adword prices are increasing as it becomes a more mainstream form of advertising. Well set up campaigns are becoming increasingly important.
Have you tried Overture? You may be able to get a better ROI there.
A lot of my competitors don't measure their advertising ROI -- they just submit their invoices to a giant corporate accounting department and when asked to show a return, they rattle-off terms like "branding" and "mindshare". I've managed to battle their loose purse strings by bargain hunting. If you can think of any good networks that might have flown under the radar, let me know.
Thanks again!
<added> Here it is:
[webmasterworld.com...]
need to drop Adwords as a means of advertising.
Rather than dropping Adwords, it would likely make more sense to scale back your maximum bids and just get whatever traffic you can within that limit. Figure out what you can afford to bid and still have a positive ROI, and be guided by that, not by what the competition is doing. You might get fewer clickthroughs as competition increases, but at least whatever traffic comes will put money in your pocket.
Look for ways to finetune your campaign, and equally important, look for ways to improve your site's conversion rate.
Above all, don't get sucked into a bidding war just because you want to be #1. Let your ROI numbers be in charge, not your ego.
The best and most overlooked strategy with AdWords is to get a top notch campaign setup from the start...
I completely agree, skibum - and thanks for putting that into words.
...Let your ROI numbers be in charge, not your ego.
Nicely said buckworks!
I may have to quote you both, as I speak with advertisers on the phone. ;)
AWA
Rather than dropping Adwords, it would likely make more sense to scale back your maximum bids and just get whatever traffic you can within that limit.
You won't be getting the same traffic any more, and I'm not talking about the number of visitors.
The lower you go among your competitors' bids, the lower conversion rate you'll have.
I had ads in a few niches that converted at 5%, when my ad was on the first or the second spot. After that, I tried to lower the bid and went down to 7-12 positions. My conversion dropped to .4% or so.
I lost a lot of impulse buyers to my competitiors.
So it's not as simple as lowering your bid to the point when your ROI becomes positive.
One recent client was spending around 20K/month and G suggested upping the budget to about 2x that to capture all available traffic.
Instead, bids were lowered to match the current budget, from an average CPC of around $0.75 to about $0.54. Clicks went up by 30% with no increase in budget, CTR dropped from 3.2% to 3.1%, cost per lead dropped by 60% and the conversion rate went up.
One sidenote: even though there are plenty of opportunities for optimizing campaigns, we can't always assume that Adwords can be profitable. There's a lot of irrational behavior in advertising -- particularly within big companies, and particularly in mainstream mediums. Sometimes an irrational market moves mainstream advertising into unprofitable territory.
For example, say I'm a Marketing Manager with a $5 mil. ad budget and loose accountability for sales results (typical big co. scenario, where accountability is shared between sales, marketing, product mgt.). My main interest will be to place my budget where it will be noticed by my superiors. Do you think I care whether I'm paying $.50 per click or $2 per click? Do you think I'm tracking my ROI? Probably not -- my main interest is in getting that top spot, regardless of the cost.
As Adword becomes more mainstream, diverting resources to less mainstream channels will start to make more and more sense.
If you have $200 to spend and you bid whatever it takes - you will get burned soon and stop. But then, another fellow will take your place in line to through his $200 away. The cycle never ends.
Large companies (in general) will run only one account, and will have only one ad displayed on a page.
With mom and pops, you can have 50 of them bidding on the same keyword at the same time.
