What is the AdWords Daily Budget, how does it work, how much do I pay – and how much will I earn?

Every campaign is governed by it’s own Daily Budget, an amount of money you are willing to spend with Google every day the campaign runs.

There is no minimum amount, although it’s sensible to buy enough clicks per day that will stand a chance of creating a meaningful conversion event (lead, sale, enquiry, phone call, download) on your website within a reasonable timeframe.

Or it could take you ages to find out whether your website converts at an acceptable rate.

The value of the conversion is, of course, totally down to what your website is selling.

And the amount of clicks you can buy is dependent on how much each click costs.

If the average cost per click (CPC) is £1.00 and your daily budget is £10.00, you can buy up to 10 clicks (10 visitors).

When your daily budget is used up, your ads stop showing until the next calendar day, as determined by the schedule settings on your campaign.

How much you pay per day will vary – some days slightly less than your daily budget, some days slightly more.

But Google guarantee that, over a 30-day period, you will never be charged more than 30 times your daily budget.

If they overshoot, you get a credit back on your account.

So this puts you completely in control of how much you want to pay Google per month.

And why it is so important to know your numbers and make sure that what you spend comes back with friends attached.

In this game, he who knows his numbers – wins.

The formula we follow is simple: "Traffic + Conversion = Profits"

Once you get more money back than you put in, how much money are you going to put in? (Answer: "all of it").

Then the concept of "budgets" goes away.

For most advertisers (and marketers) that’s incomprehensible.

But if you want to know more, just get in touch

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"How much does it cost to run an AdWords campaign, and what happens with my ads?"

I’m often asked some basic questions about costs. Here’s a recent one:

"will my web site be on the top 3 listings under all the key words related with psychic—-tarot—–reader—–and reading and others related to that and do they stay up 24 hours aday in the top 3 placement and if so how much is it per month or by the week"

For the "quick answer", skip to the bottom of the page

Unfortunately there isn’t a quck simple answer, other than "it depends"

But, if you are concerned about costs running out of control – DON’T BE!

AdWords is totally controllable with no minimum spend, with set costs for the amount you spend each day, and how much you want to "bid" for your keywords.

So if you only want to spend $1 a day, you can.

And you can turn campaigns on and off whenever you want, automatically if you choose.

But of course your results will reflect that.

It’s better to set aside a small fixed amount and be willing to write it off over a short period of time to get some results and market feedback, as quickly as possible. Then evaluate what you learned. The results can be very surprising and insightful. And profitable…

It may come back with friends attached (we hope) but it might not right at the beginning. "Good things, sometimes, take time".

In fact, the data your campaign reveals to you is every bit as important as any direct sales or leads it could generate. Many AdWords advertisers completely miss this.

Top advertisers initially *only* use AdWords for tracking and testing, before they move into a "production" phase when what they tested, proves to work. Then they will literally buy *all* the traffic that’s going, because they’re making it earn more than it costs. No more budget issues any longer…

There are many factors which determine how much your ad will cost, how long it will run for in the day, and where it will show.

It’s an auction – he who bids highest, shows highest, but with a subtle twist designed by Google to reward the best advertiser (and of course, themselves! No clicks means no-one wins, including Google who earn colossal sums of money from clicks).

There are 8 ad positions on the right hand side of every Google search results page, and sometimes (in competitive markets) another 3 in yellow at the top. There are an unlimited number of advertiser positions available.

Obviously, you need to be on the first page to be highly visible. If you’re lower than (say) Page 3 of results (lower ad position than 24), it’s likely your ad isn’t even being read (although it may be *displayed*, which is an important difference which can wreck a campaign before it even starts).

I recently saw a campaign where an ad was showing at position 401

That’s right – over 400 competitor advertisers for the same keyword ("make money"). You don’t want to be in that space.

Here are the main factors affecting costs:

• Competitor advertisers bidding on the same keywords as you
• How many searches are going on for that keyword
• How well matched your website is to your keywords (the infamous Google Quality Score, which can prevent you even entering a marketplace at all)
• How you schedule your campaigns
• How you target your campaign to a particular market need
• How you target your campaign to a particular location (local/national/international)
• How you manage and optimise your campaigns over time to reduce costs and improve traffic
• How well your market responds to your AdWords ads
• How well your visitors respond to your website experience (do they leave, linger or buy, and are you measuring that?)

Obviously, if you want to start advertising in AdWords (and you do, otherwise why have a website at all?) then you either need to figure all this out, or engage someone who demonstrably knows how it all works and can safely do it for you.

And, if he tells you to do something – you do it. Because there will be a very good reason behind it.

So, to answer directly the initial questions above:

• yes, we will position your website ad in the top 3 listings for your desired keywords
• they can stay there for 24 hours a day if your budget is high enough for that 24 hour period
  • otherwise they will turn off when your daily budget is spent
  • and come back on for the next 24 hour period
  • unless you are scheduling them for particular days and hours
• if you manage the campaign yourself you can turn it on and off whenever you want
  • if it’s managed for you that is usually on a monthly basis
  • there’s no contract, you just renew every 30 days if you want
  • we will give you an estimate of how many searches are going on for your keywords, and how much the bid prices are
  • this gives you a reasonable idea of how many clicks you can afford on a given daily and monthly budget before you decide to get started

As a Certified Google Advertising Professional, I can provide a £50 AdWords Promotional Voucher to new accounts.

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