Google AdWords Bidding Tutorial

GoogleBusiness asked:


Our Chief Economist, Hal Varian, explains the how to adjust your bids to maximize the profit from your marketing investment on AdWords.

Related posts:

  1. Introduction to the Google Ad Auction
  2. Google Adwords Tutorial
  3. Getting Started with Google AdWords
Posted on May 18, 2010 at 5:59 am by admin · Permalink
In: Adwords · Tagged with: , , ,

25 Responses

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  1. Written by beneeB
    on May 18, 2010 at 12:45 pm
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    in this example Google is making over 20% of the sale. Pretty nice margins for Google for doing Nothing

  2. Written by steddes
    on May 19, 2010 at 2:18 pm
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    @cabbagedavidge – about the figures. You have a max bid on $5 but that is not your actual cost. Your avg. cpc is 3.35 which is the amount you times with numbers of clicks. Which gives you the exact cost

  3. Written by cabbagedavidge
    on May 21, 2010 at 5:20 am
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    Only question, on the graph where you show bid $5 – Clicks 208 – Cost $697.42 etc How did you arrive at the figure of $697.42?
    Thanks for any help with this.

  4. Written by cabbagedavidge
    on May 22, 2010 at 10:45 pm
    Permalink

    Your presentation was a great way to help understand. Thanks for such clear easy to follow explanation. I have grappled with trying to understand Adwords bidding, you have now made it so much easier.

  5. Written by RealTargetedTraffic
    on May 24, 2010 at 10:30 am
    Permalink

    Great Video,

    Get Free Targeted Visitors To Your Ad

    Or Website Click My Channel

  6. Written by MrLakiwi
    on May 24, 2010 at 12:19 pm
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    Because you’re a broke ass fool

  7. Written by NewGameReleases
    on May 27, 2010 at 1:50 am
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    4 dollars for one visitor? lol i’d pay like a penny haha

  8. Written by easygoldmoneyfast
    on May 27, 2010 at 12:03 pm
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    Make FREE MONEY Online!
    New Opportunity!
    go to
    easygoldmoneyfast . com

  9. Written by FreethinkR08
    on May 30, 2010 at 9:17 am
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    There is a reason why that comment was deleted. Why don’t you address how you’re making a profit if you are paying $100 per conversion at a sale price of $300, and your wholesale cost is $200. Address that.

  10. Written by josephclawrence
    on May 31, 2010 at 6:33 pm
    Permalink

    I read your other comment, and you clearly understand the video less and less the more you watch it. None of the statements are contradictory. You rarely pay the full maximum CPC bid for a click, which is why when you bid $5 you would at worst break even, but probably turn a profit. This is not contradictory to saying that if you paid your full CPC max bid of $5 you would be breaking even.

  11. Written by josephclawrence
    on June 1, 2010 at 3:07 am
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    This is just a semantic question – Hal is calling revenue the money you generate from the sale before you factor in the cost to you for the advertising

  12. Written by FreethinkR08
    on June 2, 2010 at 10:44 pm
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    Paying up to $100 for each conversion would lead to a break even scenario. He says at this point you can still make a profit on the sale. I highly doubt this guy works at Google, they wouldn’t hire someone this incompetent.

  13. Written by FreethinkR08
    on June 4, 2010 at 9:15 am
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    Revenue is $300, not $100.

  14. Written by lalkidar
    on June 7, 2010 at 12:15 pm
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    if the CPA is 100 $ how did you make profit on that sale ? in the first simple example ?

  15. Written by deepwatermadshark
    on June 10, 2010 at 4:03 am
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    I don’t see where the “cost” value comes from if you haven’t actually done it at the CPC value. Does this mean that before applying this you have to run the auction at each value level?

  16. Written by andyux
    on June 13, 2010 at 1:27 pm
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    Im a PC!

  17. Written by miguel1233TX
    on June 14, 2010 at 11:24 pm
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    that is true

  18. Written by miguel1233TX
    on June 15, 2010 at 6:16 am
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    google bunch of robbers

  19. Written by gianka9574
    on June 16, 2010 at 9:35 am
    Permalink

    consigli molto importanti da ascoltare con attenzione e mettere in pratica… e poi si ottengono grandi risultati……

  20. Written by x2xHalox2x
    on June 18, 2010 at 11:03 am
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    Wow, so in this example google makes more than the guy selling it!

  21. Written by dayver1
    on June 19, 2010 at 12:10 am
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    The theory about ICC is fine if IF on every position you will have the same conversion rate.
    Common place 1 / 2 in Google will get most traffic, but it wont get the highest conversion rate. I am managing Google PPC account (spend $300K a month on google) and I am telling you guys, In 80% of niches position 1 and 2 will have lower / higher conversion rate when position 5 and 6. So you have to make that adjustment as well when calculating your Max Profit per Conversion, ICC etc.

  22. Written by auspirevideos
    on June 21, 2010 at 10:11 pm
    Permalink

    Applying this tutorial to your own Adwords campaigns can be very revealing. Many Adwords users are unaware they are spending more per click than their conversions can afford.

  23. Written by jbigga
    on June 25, 2010 at 8:32 am
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    HOW DO I JUST PAY FOR CONVERSIONS?

  24. Written by OwnzTer
    on June 28, 2010 at 8:49 am
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    Hey Hal…. can i have 50% of googles proffits? please…!

  25. Written by ajcolman
    on June 29, 2010 at 6:09 am
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    What! if you make $1000 profit, you have to give nearly $700 of it to google??? Do you think we are silly!!

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