Google AdWords™ is cost-per-click (CPC) or pay-per-click (PPC) advertising.
You pay only when users click on your ad. It has features that allow you to control your costs by setting a daily budget for what you are willing to spend per day. AdWords sponsored listings are also being shown on Google's partner sites.
Google has a measurement system call "Quality Score."
The order of ads shown during a search is determined by several factors.
One is the amount of money advertisers are willing to pay Google for a user to click their ad, and others are the relevance of the ad to the search and based on the historical click-through rate of the ad.
Google recently began to factor in the content of the landing page and looked for matching keywords between the keyword list, Google ad and landing page.
The overall quality score also influences an ad's position on the Google network, as well as affecting the calculation of a keyword's minimum bid.
Below is a list from Google Expert Howie Jacobson of information you need to know to avoid costly Google AdWord Mistakes:
- What is the average value of a visitor to your website?
- What are your 10 most profitable keywords?
- Which ads are most profitable?
- If you are using the content network, which sites deliver the most valuable traffic? (Do you even know which sites are displaying your ads?)
- How much time, on average, do visitors spend on each of your landing pages?
- Which is more profitable: going for the sale on the first visit, or trying to capture contact information for followup marketing?
- What price point delivers the highest profit for each of your products?
- What browser size are the majority of your visitors viewing? (And are you making sure that the most important content of your web pages fit inside that area?)
- What ad position is most profitable for each of your biggest keywords?
- At what place on your landing page do most visitors stop paying attention?
If you can answer questions 1, 2, 4, 6 and 8 off the top of your head, and can find the answers to the other questions in a matter of minutes, then congratulations! You're on your way to being an AdWords pro!
If you can't, then you're probably wasting at least 50% of your AdWords budget every single day. At least.
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