Daily budget

Am I missing something?

[bcc1234]

I could never understand the purpose of setting a low daily budget.
I've been advertising products by using PPC for years, and I still don't get it.
For all of my projects, once I've fine-tuned the keywords and tweaked the landing page for good conversion, I simply can't get enough traffic as it is, without setting any limits.

If I make more money on a click than what it costs me, why in the world would I want to limit the number of clicks I get?

Today, I talked to Yahoo's rep about opening a Fast Track account in hopes that it offers a few things that I need that are not present in the free accounts, and she also kept mentioning the budget feature for some reason during our entire conversation.

This got me thinking that maybe I'm missing something.

Can somebody explain the purpose of a daily cap to me?

[vincevincevince]

Many reasons...

1. Your firm can only handle 100 customers a week
2. It takes 2 months to get the affiliate earnings so a large hike in PPC spending will cause a cashflow crisis
3. You know that by giving others a share of the top-spot it helps them keep their bids low, keeping yours down as well
4. The monetisation isn't entirely reliable and you need to insulate yourself against excessive risk

[webdudek]

Some companies run ppc ads as public relations campaigns. They want to spend $20 just for people to see them, and know them. It's like putting an ad in the paper or in any other media, where they don't make a profit per click.

Another use is to protect you against click fraud. (or click flud)
In one of the PPC engines I pay $30 every day and I set a limit of $100 a day.
If something unexpected happens, I want to be in control.

[vincevincevince]

Compare it with T.V. ads.

If you are running T.V. ads and find that they bring in more profit then they are costing you to air then would you proceed to try and buy every single commerical slot on air?