PPC Bidding Strategies: Computing The Average

Writing by Brick Marketing on Monday, 5 of November , 2007 at 12:56 pm

If you’re not sure how much to bid for your keywords in your next pay per click campaign, try the average bid strategy. With the average bid strategy you take the five highest bids at Overture and compute their average. Since Overture is open bidding and you can see the bids of your competitors before you bid yourself, this is easy. Let’s say the top five bids for your keyword are:

.52
.49
.48
.42
.40

The average of these five bids is .462. Rounded down, you would bid 46 cents. That will put you in the fourth ranking position for your keyword. It’s a good place to start.

I wouldn’t use this strategy, however, if you are in a highly competitive industry where the keywords are expensive and you’ve never done PPC before. You could easily lose your shirt. I would use this strategy is you are new to PPC and the competition for your niche is not so fierce. If you are not new to PPC and you are entering a new niche area where you’ve never done PPC before then this strategy can be a good starting point. NOTE: It is a starting point.

You will want to go back and tweak your bids after you’ve had a chance to gauge your initial performance. You are not, by all means, going to keep this bid. You might find some keywords do extremely well in that position. Others may not. You’ll want to raise some bids and lower others. That’s perfectly acceptable. Still, you’ve got to start somewhere and by starting in the middle of the pack you can test how deep the waters are and how fierce your competition is without too much of a commitment.

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                      Category: PPC Bidding Strategies                      

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