Keywords that Break Even - Keep or Trash?

What do you do when you only reach your break even point?

[Sports Workout]

Here's a question i've been fighting with lately...

if i have keywords that are only breaking even (the amount i am paying for clicks, equals the amount of profit I make per sale) is it worth it to keep the keyword?

it costs me shipping and order fulfillment time, but it also gives me another customer to add to my mailing list.

any thoughts?

Zack - not Shak

[roitracker]

Keep it. Try to increase the average order amount on the front end & go for repeat sales on the back-end.

[cline]

There's an old direct marketing rule of thumb that says you should acquire new customers at breakeven and make all your profit on repeat sales.

[Robsp]

zack,

It also depend on how accurate you measure. The adwords conversion reports for example are always reporting fewer conversions/sales than actually occur (because of cookies and people searching on one machine and buying on another). In our case breakeven keywords (by the adwords measurement tools) actually deliver a profit.

[eWhisper]

I would have to agree with the above advice. If your average customer buys more than once from your company, then break even keywords are profitable in the long run.

I'd keep the word, continue tweaking costs, ads, etc to try and make it profitable in the short run.

[john_k]

Generally, increased sales volume is good as it increases your cash flow. It also increases your purchases from suppliers which often leads to better pricing.

On the flip-side, depending upon a lot of variables, the increased volume could put an unwelcome drag on your operations. If you or your employees are already working overtime, then maybe it's not good. If you don't have credit terms with your suppliers and have to pay right away, then the increased sales might empty your cash supply.

So really, it depends on your business and where it's at right now. If you don't see a need to cap your sales volume, then more is usually better.

[vanderbolt]

I have another take on this. If you get rid of the kw that breaks even, you are benefiting your competitors. Better to break even, and make the kw more expensive for your competitor. Remember, the stronger your competitor gets, the more resources he has to use against you.

[Marty_Foley]

Zack,

One approach would be to do some more keyword research on that specific term, looking for more negative keywords to use in the campaign.

By using them you'll then get fewer impressions for the term, but the clicks should be better targeted. That can bump up your return from "break even" into the black.

Marty Foley