How To Determine Your Optimal CPC Bids

Bidding for your Search Engine Marketing campaigns can be quite a tricky thing. The whole idea is not to bid too high or too low, but just right for your business.

Bidding too high will cause your daily budget to run out after a few clicks. Bid too low and you might not rank high enough in search result to achieve the number of clicks you want. Before you set your bid, consider what you can afford to pay for a click. Remember that the bid you set is the maximum amount you will ever pay for a click. Your actual cost-per-click (CPC) will likely end up being less than your bid.

Consider the actions that you want users to make when they are at your side and determine how much that particular action is worth to your business. Bidding is different for every business even if they are in the same industry. A completed action is called a conversion and it can be anything from signups to online purchase.

The performance metric CPA (Cost Per Acquisition) is a useful metric to determine your CPC bids. How much you should bid would be determined by how much that particular conversion is worth to the company. Think about the bids for individual keywords and their conversion rate. It is logical to bid higher for for those keywords that tend to have a higher conversion rate.

Because the market and customer behavior changes, competitive bids change, too. Constant monitoring of your clicks cost and bids will alert you to those changes. Remember that paying too much for clicks can mean losing money, but paying too little may result in your ads ranking so low that prospective customers overlook them.