How to Lower Your CPC Costs in AdWords Advertising Platform

Google AdWords is a highly popular pay-per-click (PPC) advertising platform. This ad service only charges you when a user searches on Google and visits your website as a result. You only have to pay when a potential customer clicks your ad and visits your website. If the procedure is followed properly, PPC can effectively bring high-quality traffic at a competitive and reasonable price than any other forms of advertising. Though it is relatively low cost, you have to know how much it is going to cost you overall

The risks associated with AdWords charges

Google Adwords is a great marketing tool for you, but if you don’t know how to skillfully manage the process, the costs will start to pile up first. AdWords lowest charge is one cent per click, but in some cases a single click can cost you a massive $55. Without proper management skills you could easily end up paying double or even triple the amount of money you had originally hoped to spend.

The main problem for you is how can you keep the costs under control and still invite a large number of customers and earn profit. AdWords has become a highly complex system with several dozens of adjustable variables. Often companies invest with AdWords and end up paying way more than they have anticipated. The end result is quitting this wonderful platform and leaving without profiting from it.

This is why it’s common to find companies who have a negative experience about AdWords. This is unfortunate because when used properly, AdWords can give your business a huge boost in web traffic, credibility and profit.

How Google AdWords charges

Your cost per click and total cost are determined by a number of factors, including:

  • Competitiveness of your keyword: The competitiveness of your keyword is a factor in how much you have to pay. You have to strike a balance between keywords that are both effective and affordable.
  • Maximum bid and bid position: Higher bids help you to get higher rankings, but they are likely to be the far more costly. Choose your bid strategically in order to find best-value bids.
  • Your click through rate (CTR): Google monitors the effectiveness of your ads and rewards the ads and keywords that have higher click-through rates with a lower fee per click.
  • Your keyword quality score: Google rewards you on the basis of your quality score. Google analyzes your quality scores by calculating CTR, landing page relevancy and ad relevancy.
  • Your advertising history: This is not documented but rumors are saying that your average click cost is negatively correlated with the rime spent on advertising.

These are the most known key factors that decide your AdWords costs.

Follow 12 Steps to spend less on pay per click

  1. Create single keyword ad groups (SKAGS): Make sure each of your ad groups has one keyword with three different match types: exact match, phrase match and broad match. SKAGS ensure that your text ads and landing pages are highly keyword-specific, therefore increasing quality score. You pay less when quality score is high.
  2. Create two ads in each ad group: Creating just two ads in each ad group enables you to split test your traffic between the ads. Split testing your traffic allows you to find which text ads generate more clicks and cost less. Once you know which are most effective, you discard the failure and create another ad to test against the successful one. The two keyword specific ads improves your click through rate, relevancy over time and help lower cost per click.
  3. Make sure your landing pages are keyword specific: Use dynamic keyword insertion or DKI and make sure that the ad group specific keyword shows up on your landing page. DKI will ensure that your landing page always contains the keyword that the potential customers looking for.
  4. Check your quality scores: Everything with Google AdWords is linked with Quality Score. As you know Google determines your quality score from your ad relevancy, landing page relevancy and CTR. You pay less per click when all of these areas are above average.
  5. Strategically adjust your keyword bids: Your cost per click will go down if your lower your max bids. Furthermore, you have to adjust your bids wisely or the ad position will fall and you will not get any conversions. Find some top performing keywords and lower their bids by a few cents. If that helps, lower bids on those keywords further and lower other keywords’ bids, too. Monitor changes and don’t make a lot of sudden changes at the same time.
  6. Add negative keywords: Look for negative keywords at least once a week, it will ensure that you are not paying for unnecessary clicks that drive up costs. Constantly adding negative keywords make clicks from the users more relevant, which will improve click through rates and increase your quality scores.
  7. Eliminate internal competition: Eliminate internal competition and keep clicks from users as relevant as possible. For example, a high price short tail keyword could be shown over a low price long tailed keyword. To avoid this, run the keyword diagnosis, find which keywords are blocking others and add negative keywords so that they are showing in the ad groups you want.
  8. Find intent-based low cost keywords: Find intent based low cost keywords to bid on. For example, if you own a house rejuvenation service, using a keyword like ”damp carpet” brings a lot of traffic, but it will also bring many unrelated searches based on carpet and materials related to carpets.
  9. Avoid keywords with a high cost and few conversions: Categorize your keywords by cost and filter by conversions, then you can find the keywords that are costing you most without any ROI. Avoid costly, non-producing keywords. Invest in low cost and more profitable keywords.
  10. Regularly add new keywords to accounts: Always research new keywords to bid on. With the help of the search terms report, you can discover new keywords. Add altering search terms as new keywords with their own ads and ad groups.
  11. Use ad scheduling: Ad scheduling has a lot of potentials to save money and often overlooked. Monitor your clicks, cost, and conversions 24/7 and if you find a certain hour with high cost clicks with very low conversion, create an ad schedule in your campaign settings and exclude that time. Depending on your business, certain times of the day and certain days of the week could be much more profitable than others. Utilize this opportunity and soon your cost will come down.
  12. Check the geographic locations: Check where your ads are showing up. Geographic reports will show you if your ads are reaching the right group of people and which areas are most productive. If you are a local company, but getting more hit from outside your reach, then you should change the advanced campaign location to show “people in my targeted area” only. You should also avoid high cost areas with a very low conversion rate.
  13. Don’t make too many changes with your pay per click ads. Make one change and notice what happens and then make a decision about other factors.

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