I put the words "one time fee" in my ad hoping to strongly target those who click. BUT, people still click anyways, still don't buy, no sales for me. The landing page looks great, too, so I don't get it... But really, why are my minimum CPC prices so high when I just did a search for my leading keyword phrase and only my ad and one other came up (making only two ads total)...? Does competition (or lack thereof) really have no bearing whatsoever on that cost?
Delete keywords that bring you only impressions, but not clicks. This will help you to get higher CTR=lower costs. Group your keywords, so they are very similar to each other, this will help you to write better ads. Try another product in the same niche and see how it goes.
Competition, (or lack of), has zero bearing on the cost of an ad. It's adwords way of not letting you find niches anymore to exploit.
Your clickthrough rate and position are the main drivers that determine your minimum bid - if you have a high clickthrough rate for your position, you'll generally get a good quality score, and hence a low minimum bid. There are exceptions, when your website offends Google, or is not related to the search terms. But as PPC Coach says, a low number of competitors won't help you much (although less adverts should mean a better clickthrough rate). With only 2 adverts appearing, then you should be looking for an absolute minimum of 5% CTR in my humble opinion (feel free to disagree), and ideally 10%+. If you aren't getting this, then either 1) You don't offer what people are looking for 2) You do offer what people are looking for, but they don't realise that 3) Somebody else looks more reliable or cheaper or just better 4) People aren't even seeing your advert.
Instead of a PayPerClick model , Try a CPM model .... It helped me a lot .... Ads will be shown to only a targeted niche sites + you get backlinks , if only for a while....
If you're not making money on a CPC model, you won't make money on a CPM model. If people who click generally don't buy, then many people who see the ad won't click. In the end, it's all the same - you can get the same exposure by using both CPC or CPM bidding with AdWords.