Fluctuating CPC

Keyword stats consistent for all except CPC

[ucdawg12]

In one of my more successful campaigns, ROI wise, there is one specific keyword that has very violent and costly changes in its daily CPC. This keyword gets around 600 clicks a day and averages around a 10-11% CTR. The clicks, impressions, ctr, they all remain relatively the same, yet lately, my CTR has been going through the roof, then coming back down, but always higher than it previously was. For example, just three weeks ago, it was costing me .05 a click, which of course I was very happy with, then I started to notice it rising to .06-.07 which was not welcomed, but not the worst, but soon after that I have been getting days where I am paying .11-.13 a click which is twice of what I am used to, and very costly. Then it will drop to .07-.08 which is still too high for me but I accept it after what has happened the day before. My stats all remain the same, my MAX CPC, remains at around $4 dollars which Google has been recommending to get the #1 spot, although recently it has gone as high as suggesting $18... Can anyone help me understand why there are changes like this? I mean if its competition, why isnt it consistent? I doubt the competition gives up after only a day but then decides 2 days later they want to try it start up again only to again drop it the next day? I am also the only ad to ever show up under my keyword, most days I have an ad rank of 1.0, some days 1.1.

Oh, also, I was wondering about something else that might be causing this. I have read about recent Google changes which judges your CPC and Ad Rank on your Ads CTR, but does it judge your Ads CTR on a whole(all the stats of your keywords combined?) Or does it go by your keywords AD CTR? which would be the CTR I am seeing under my stats since I only have one ad. I have a few high volume keywords in this group that get thousands of impressions but have a CTR rate of 1.1 which drags down the overall averages in my campaign.

Thanks :)

[ucdawg12]

I guess no one else has had any experience with this?

[ucdawg12]

ah this is swell, now im up to a record 21.6% CTR and get the reward of paying .16 per click, how beautiful it is to not understand the formula at all :)

[mike_ppc]

It is a very interesting situation; however, I cannot express a clear opinion without having all the information.

One question though: Why is your MaxCPC 4$? If you want to pay less, why don't you keep it at 0.15?
Especially if your niche is not very crowded.

But sincerely, I doubt that for a KW that brings 600 clicks per day there is only your ad...

What I recommend you to do is stay a day or two and look at every click - how much it costs. You probably have hundreds of 0.05, but you could have some of 3$....

[MovingOnUp]

It's definitely competition.

First, if you're happy with $0.05, don't welcome $0.06, consider $0.07 too high, and $0.11 is too costy, there's no way you should be bidding $4. Lower your bid to $0.05 or $0.06. You won't always be #1, but you won't pay more than you're comfortable with either.

What you're probably seeing is a competitor coming in, trying to get the #1 spot, then running out of budget or getting the keyword disabled due to poor CTR. If you're getting 10% CTR and a new advertiser gets a 2% CTR and bids $0.50, you'll pay $0.11 to retain the #1 spot. They may actually only pay $0.05 since the #2 bidder's acual CPC is based on the #3 bidder's Max CPC and both of their CTRs. If #2 bids $19.50 with a 2% CTR, you'll have to pay $3.90 per click to retain the #1 spot. They may still pay as little as $0.05. At 600 clicks a day, $3.90 per click will cost you well over $2000. A savvy competitor could inflict some major pain on you thanks to your massive overbid.

Some points to remember:

1) You don't need a big bid to get the #1 spot. I have hundreds of keywords with a $0.05 bid and a #1 position. A good CTR works in your favor.

2) Don't bid more than you're willing to pay.

[running scared]

Or it could simply be a competitor having fun at your expense

[ucdawg12]

well I think I should update you guys on the awesome development I woke up to today. For the past few days my CPC has gone up from its usual .07, .08 this month to the .14-.18 range. Something similar happened last month so I figured I'd let Google get it out of its system or something so I just let it run. Well, today I had the great surprise of waking up to a 2.95 CPC that already had accumulated 400 clicks in record time which meant unbelievably heavy losses for me :/ Now, I can understand the small jump from .8 to .18 (even though it didn't seem very small to me at the time but boy now it does..) but for a CPC to jump $2.77 from one day to the next is pretty extreme. Also I am a bit annoyed about Google's Campaign Daily Budget handicap which because of inaccurate estimates forces me to put it at over $10,000 if I want my ad to receive all it's impressions despite the fact that it had never costed me more than $50 a day up until today. Ugh.. what sucks so bad is that I woke up 3 hours ago really tired with only 6 hours of sleep (which has been happening to me on the weekends) so I was like, I'll just try to get some sleep and on today of all days it worked :/

[Steve6]

Patient: "Doctor, it hurts when I jog barefoot through broken glass."

Doctor: "Well, don't do that."

ucdawg12: "It costs me too much money when I bid $4 CPC and $10,000 daily budget."

Webmaster World advice: "Well, don't do that."

My advice: Change your max CPC to $.05 and report back to us in two weeks.

[skibum]

Take the initial traffic estimator projections with a grain of salt and don't gamble more than you can afford to lose. Think of it as a sales person who is probably trying to sell you a much more expensive product than you need. Run different max CPCs through the estimator and see how things change when the max CPC is lowered.

If $0.07 per click is high, then a $4.00 max CPC should never be put in there. If you can't/don't want to pay more than a certain CPC, then don't set the max CPC any higher than that.

Rest assured that if the max CPC is set at $4.00 and the daily budget is set to $10,000 Google will deliver all the traffic it can and if for some reason there is a surge in traffic on those keywords and the CPC rises up to $4.00, there will be a credit card bill for $10,000 one day, assuming that the credit card does not max out before that.

If all the traffic in the world at $0.05 or $0.07 will be profitable then you might consider a high daily budget combined with a max CPC of $0.06 or so.

[inbound]

ucdawg12,

I'm sorry to appear unsympathetic but you were clearly warned about your overbidding and yet a month later you still had not changed it.

Add to that a $10,000 daily budget when your spend is only $50 a day! what were you thinking.

I'd say you should try and discuss this with Google, maybe they will laugh enough to take pity on you and offer a refund.

Seriously, you could alert them to the fact that their poor estimates forced you to a high daily budget if you can prove it, maybe they will look at a refund rather than try to prove their estimates work well (they would find plenty of evidence that their estimates are badly out on many campaigns).

Good luck & listen to people here in the future.

[MovingOnUp]

Some people learn when they're told. Others learn when they see posts from other people who lose outrageous amounts of money. Others have to lose $1200 in a day before they'll learn.

Never bid more than you want to pay.

[mike_ppc]

I don't want to come and tell: "i told you". But it seems that is exactly the case.
In fact, the reality is that you probably have some competition (on some broadmatch, for ex). Competition saw you and asked: ok, about how much is he paying?

Usually he probably has a 0.05 bid, and is on 2nd place. Then he puts a bid of 1$ and goes back - you are still first. Then, 2$, 3$....you are still first. Then he maybe says: "i'll tech this guy a lesson!" And he puts his MaxCPC at 3$ and clicks your ad. At the beginning - twice a day. Nothing. And now, he's going for "industrial" - 100-200-400 clicks a day.

Does it look possible? and familiar?
I still do not understand why can't you just bid 0.1 and see what happens?

just can't understand.