Learning Google Adwords can be tricky and hard however once you know the concept behind, it will be like fun for you. When you create your ads, you choose a set of keywords for which you want to display ads and then select the area or location in which you want your ad to be appeared and last you have to bid for the ads. Since Google Adwords is based on pay per click model, you will only pay when someone click on your ads.
Adwords also allow you to save money as its Program Discounter automatically reduces the cost per click of your ad based on the competition to maintain the position of your ad ($0.01 above your competitor).
How to make better profit from Adwords
Google Adwords is now a day one of the vast pay per click program used by advertisers. Why most of the advertisers prefer it because the benefit of using is more. How you can profit from it depends solely on you. First you have to determine how much you are willing to pay for cost per click. Doing this is important as it enables you to know how much you can afford to make profit from your business. In order to know how much you should bid, you first need to find out the conversion ratio, you can calculate your conversion ratio by dividing your total number of unique visitors by number of sales you made from that number of users and then you can multiply it by 100 to get the percentage of sales you are making per number of visitors.
Let’s take an example on the above scenario: Suppose you are getting 10000 unique visitors per month to your site and in that number of visitors 300 peoples buy your product giving you $50 each. So your conversion ratio will be (300/10000)*100= 3%. That means for every hundred visitors you are getting to your website you are making three sales giving you profit of $150.
To get the exact amount you need to bid on your ads to still make profit from it divide your gross profit ($150) by 100 to see how much amount you can afford per click with Adwords. In this case you can bid $1.5/click to make sale with no loss and gain. So I would suggest always bid lower amount than the $1.5/click in this case. Google Adwords allow advertiser to start with $0.05 cents per click so play your card safely and cautiously at initial stages.
Here is the part2 of Learning Google Adwords, in which you will learn how to choose appropriate keywords for successful Adword campaign and how to create attention grabbing ad copy. And at the end of part2 you will get direct down-loadable free e-book Adowrd Made Easy by Brad Callen.
