The following excerpt is from Perry Marshall, Mike Rhodes and Bryan Todd’s book Ultimate Guide to Google AdWords. Buy it now from Amazon | Barnes & Noble | iTunes | IndieBound
How much should you put out on the table to start the Google AdWords game? That’s a vital question to answer. Fortunately, Google’s tools make it far less of a crapshoot when you first launch a new campaign or ad group.
Start with manual bids
Manual bids are the best way to understand firsthand how your dollars are working (or not working) for you. We don’t advise starting out using Google’s various automatic bid settings. Don’t run to those until you really understand how your bids are paying off for you. Start with fundamentals — numbers that you can personally see, respond to and adjust.
Frankly, Google’s machine isn’t good at figuring out what your bids should be until it has a significant amount of data. You’ll need to be getting at least 50 conversions a month (at the campaign level) before you start using automated bidding.
Where to set bids
Google Display Network (GDN) campaigns can be a bit complicated. For now, let’s focus on Search.
Search gives you two options. The first (easier) option is to set bids at the ad group level. The second is to set them at the keyword level. Like a manual versus automatic transmission, keyword bidding gives you more control, but you’ll have more to watch and manage.
What to use as a starting bid
We suggest you begin by using Google’s Keyword Planner tool. Enter your keywords, and it will suggest a reasonable starting bid. If you’re not comfortable with Google’s recommendations, start with $1 or $2 per click. This will of course depend on your own budget and appetite for risk. Whatever you use, it’s only a starting point. You’ll be changing it often.
There are three extra columns of data that you’ll want to add next to each of your keywords to use as a guide for getting your ads seen affordably. You’ll find these under the Keywords tab: Click on the…
