How much to spend on an AdWords click

by Sapphire (May 21, 2005)

A couple of days ago, I made a really big booboo, but I think I learned something very interesting from it. I meant to set my maximum click amount on one of my AdWords campaigns to 17 cents. I was pretty sure it was doing better the lower and lower I set the amount, so I was dropping it from 19 cents.

Instead, I accidentally hit 70 cents somehow. $11 later, I realized my mistake and fixed it. But now I had all these expensive clicks to look at and compare to my cheaper clicks, at rates like 23 cents and less. Guess what I found?

The click-through rate on the more expensive clicks sucked bilgewater. This is good news, as far as I’m concerned. And I have a theory on why it’s this way:

If they see your ad first thing and click it, you’re like the first store they’ve been to on their hunt to find The Perfect Object at The Perfect Price. I doubt very many net shoppers buy from the very first site they see. If you pay a lot for AdWords clicks, you’ll be the first.

If you’re a cheapskate, you’ll get fewer visitors, but the ones you get will be more certain what they want. The other sites they’ve been to have failed to convince them. You get to step in while they’re tired of looking but still want to buy.

So, higher click amounts give you more traffic, but lower click amounts give you better conversion rates. That’s my theory. It may be wrong, or there may be a lot of exceptions. But it’s worth thinking about.

Posted in PPC
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