In theory, if advertisers are cutting their budgets, they are either lowering CPC, cutting keywords, or cutting adwords altogether.
Does this mean, there's an opportunities for us small businesses to (dare I say) RAISE our CPC (or keep it untouched) and actually CLIMB THE RANKINGS for ad position?
Hubie
I think one reason is that thousands of companies sometime in the past set up accounts (or hired someone to do so). And then, after the initial rush they have not kept it updated.
Out of curiousity, I checked a few keywords for obsolete products/brand names, and see little change.
I believe that AdWords was (somewhat) successful in creating an environment where they can get a nice gain from our max bids.
Most of manual bidders were used to put i.e. $1 while paying $0.30-$0.50 per click. That in many cases has turned to be higher now, simply based on their max bid which in other words is their willingness about how much they are ready to pay. The bad thing is that they still keep their max bids at same level.
I think that max bid change is worth of testing more then ever before. I also think that Google’s algo is capable of “learning” how much MONEY it should EXPECT from each keyword, IN ADVANCE. That could explain why you get charged $0.75 per click while there is nobody around you. The algo makes a prediction, and then it watches if the prediction is being fulfilled. It simply has to figure how to make $100K from the “keyword” this month.
Now, it is not that Google is setting it up by having some folks coming up with the budget and profit prediction for next year. It’s actually a complex process where the algo is coming up with these numbers based on the historical data, possibly the data from Analytics, with a special attention paid to those that have conversion tracking turned on.
In order to get your cost down, you have to push the algo learn that it cannot get so and so from your keywords anymore, but less from now on. That would require few more top players to reduce their max bids for a period of time.
This is just my logic though.
The fact is that most Google AdWords accounts are run quite badly, and too many companies have been happy to throw money at their accounts.
These companies are now exercising a little more caution.
There's never been a better time to handle your Google AdWords account properly. It's the age of the professional!
Does this mean, there's an opportunities for us small businesses to (dare I say) RAISE our CPC (or keep it untouched) and actually CLIMB THE RANKINGS for ad position?
There is no quick answer to this interesting question. I'd have to say that it largely depends on the industry that you're in.
DEMAND FOR OPTIMIZED CAMPAIGNS
We've seen a lot more interest in paid search where people are approaching us to help them optimize their campaigns. This often means "How can you help increase my PPC performance while keeping my budget the same or even reducing it?"
BUDGET CUTTING IN SOME VERTICALS
In some verticals you'll see some advertisers spending less, especially those that may not have optimized campaigns so they simply cut their budgets to save some money.
CPC PATTERNS YOU CAN TAKE ADVANTAGE OF
This creates an opportunity where you might actually see the CPC drop later in the day when several competitors' ads drop off as their daily budget is depleted and capped out.
SOME IDEAS TO CAPITALIZE ON BUDGET CUTS IN PPC
We are already seeing these daily patterns and have implemented strategies to capitalize on them to increase ROI. For example if your budget is smaller, you might want to lower your bids and/or exposure earlier in the day and go more aggressive in the afternoon/evening.
Alternatively, if you have a larger budget and can outspend your competitors, you might play hardball and increase your bids/exposure earlier in the day and then reap the benefits of a lower CPC and higher conversion rate in the afternoon and evening after the competition has.
Either way, any of your competitors that have their campaigns on "set and forget" mode, will likely be missing out on these opportunities.
