How to identify if it's worth running Adwords

Are my prices worth it?

[Willsox]

I created an affiliate website that I figured would make $20 per sale, but of course the additional cost of adwords would bring my profit down. I started at 5 cents and then 25 cents, with no clicks. It took me nearly a dollar to finally get 6 visitors, with no sales. At this rate, it doesn't sound promising that 1 in 20 will buy anything. Unless I guess if people were coming back to my site after that. So I was wondering a couple of things. For one, how much does google weigh the CTR of a particular add with the amount you are bidding? I've heard that google tends to rank ones with higher CTRs higher. And also, is there any substancially cheaper search engine or anything for that matter that would be effective? Or is this advertising just a losing battle for me until have have more money to put in?

[idolw]

find out what your site's conversion rate is.
if it is 10% you can even bid $1.5 per click and still have small profit.
if it is 0.1% you'd better not go over 2 cents per click.

[ferraristi]

Also, try and think of some other keywords that may be cheaper due to competing sites not bidding on them.

[dgoodwin280]

There really is not enough information in your post to offer advice. Sure, you might be paying $1 per ad but we don't know why you are paying $1. Are your ads optimized? Ad optimization (relevance and copy) has a huge affect on price and click thru rate. Are you using negative keywords to filter the irrelevant searches? Are the ads in the top spot, middle, bottom? Where do you want them to be.

There are many, many factors that go into the price you pay.