The Entrepreneur Forum | Startups | Entrepreneurship | Starting a Business | Motivation | Success

Newbie Mistake #1 - Limited by Budget

Accelerate wealth. Build a business that pays freedom. Join more than 70,000 entrepreneurs and register for the Fastlane Entrepreneur forum. Remove ads? Join the INSIDERS.

Andy Black

About to go on a video creation spree...
Staff member
EPIC CONTRIBUTOR
FASTLANE INSIDER
Read Millionaire Fastlane
Speedway Pass
May 20, 2014
12,449
48,998
4,306
Ireland
AdWords Newbie Mistake #1 - Limited by Budget

KUP5OpA.png


There's a lot of unknowns when you first start an AdWords campaign:
  1. You don't know what the search volumes are (even if you've got estimates from the Google Keyword Planner).
  2. You don't know what your ad position will be for your given bid price.
  3. You don't know what your click-through-rate (CTR) will be for your given ad position.
  4. You don' t know if your CTR will be better than your competitors in the same ad position.
  5. You don't know if Google will reward you with a discounted cost-per-click (CPC), or punish you with a higher CPC.
  6. You don't know if Google will reward you with a higher Impression Share, or punish you with a lower Impression Share.
  7. You don't know what your click volumes will be, since it's determined by the search volumes, your Impression Share, and your CTR.
  8. You don't know what your conversion rates will be, and your earning-per-click (EPC).
  9. You don't know what your return-on-investment (ROI) will be.
Yep, lots of unknowns!

Forget estimating these metrics. You'll be wrong, and you could have got a campaign running and got the answers in the time you've just spent asking the question and created some complicated Excel model.

The only way of finding these out is to launch and learn.

At the start, when you are gathering your metrics, it makes a lot of sense to cap your spend by putting a daily budget on your new campaign. If you hit a rich vein of traffic then you'll hit your budget quickly and your ads will stop showing for the rest of the day. This prevents your costs spiralling out of control.

But the big newbie error is to cap daily spend AFTER you've gathered all your stats.

This is especially true if you're getting a positive ROI. If you found a box at the bottom of your garden that returned $2 for every $1 you put in, would you limit your spend for the day to $10? I think not. You'd put in as many coins as you could find. You'd get a loan from the bank and put that money into the box too.

If you're positive ROI, then set your budgets a bit higher than your max daily spend. You don't want to limit any incoming traffic, and you just want a budget set as a fail safe in case someone accidentally forgets the decimal place when amending bids, or accidentally removes your landing page.

If you're negative ROI and are hitting budgets, then keep dropping bids until your daily spend hits your daily budget to buy data, or until you get profitable. You'll get more clicks for the same cost, and each click will be cheaper and lose you less money.

DON'T BE LIMITED BY BUDGETS
(unless you're buying data)
 
Last edited by a moderator:

Kate

New Contributor
Read Millionaire Fastlane
May 9, 2014
23
18
19
37
NJ
I just put keywords on bing a week ago and they literally have had no impressions or clicks (obviously). My words aren't really that crazy (activities for kids) lol maybe bing just doesn't get as much traffic as google so I will be heading to AdWords to see if I have any luck there... don't know the point of my post, just venting frustration I guess lol my fb ads are getting impressions and clicks up to my max, so there's that!

Sent from my SGH-T999 using Tapatalk
 
  • Thread starter
  • Moderator
  • #3

Andy Black

About to go on a video creation spree...
Staff member
EPIC CONTRIBUTOR
FASTLANE INSIDER
Read Millionaire Fastlane
Speedway Pass
May 20, 2014
12,449
48,998
4,306
Ireland
I always start with AdWords.

Hold on, correction, I only use AdWords. :)
 

Boo Blizzi

Bronze Contributor
Read Millionaire Fastlane
Speedway Pass
Mar 3, 2009
208
386
186
I always start with AdWords.

Hold on, correction, I only use AdWords. :)

...then you're leaving money on the table. Bing serves ads on Bing and Yahoo search engines. They do not have as much traffic as Google, but the traffic is cheaper and it converts.

Sometimes better than Google (depending on the niche). The reason is because Bing users may be older or less savvy than Google users. Most people using Bing are doing it from Internet Explorer. Which means they are not concerned with using a better browser (Chrome, FF) or dont know how or care to change their search options.

Which means when they are searching for a solution or product, they will most likely go with one of the first options they see. They will not dig deep and research as much as a savvy Google user. This makes it easier for beginning PPC marketers to get profitable campaigns going.

Oh yeah... and you don't have to worry about all that compliance crap you deal with on Google. You can throw up a 1 page lander and go for it.
 

Sponsored Offers

MARKETPLACE Fox Web School "Legend" Group Coaching Program 2021
Cool - glad to have you. And yes it should help a lot. When you are in the new group just post...
  • Sticky
MARKETPLACE NEW: The Best School for Going Fastlane (Now open for summer enrollment)
Hey everyone, I have a big announcement to make about how we are going to be working with...
MARKETPLACE Not sure how to start? This free book will teach you how to build a successful web design business
Hi Fox. Starting the book and got through the introduction. Had a conversation with Andy Black...
  • Sticky
MARKETPLACE You Are One Call Away From Living Your Dream Life - LightHouse’s Accountability Program ⚡
Chris is super sharp and is aware of many facets of entrepreneurship and can help get your...
Introducing MJ's Personal Unscripted Network, Join Now for FREE!
Any chance to make it available outside of US? It has been available outside of the US on...

Forum Sponsor

Learn Fastlane Business Skills & Get Profitable Within 30 Days...

Get Started Now

New Topics

Fastlane Insiders

View the forum AD FREE.
Private, unindexed content
Detailed process/execution threads
Ideas needing execution, more!

Join Fastlane Insiders.

Top Bottom