After looking closer at what Google is saying about why my ads aren't showing up (why the quality score is listed as poor) I see that they take into account the Click through ratio of that ad, I guess the bastards figure they can get everyone in a catch 22, if your ad hasn't shown yet your CTR is going to be 0% so do you have to take a few "slaps in the face by Google" and pay for expensive clicks in order to eventually be able to get the quality score approved and lower the price?
if you are bidding on a keyword for the very first time then a few scenarios play out. 1. Yes you will be overpaying until you get your own unique history 2. Google knows the other people CTR's are so they base your expected performance against theirs. If you under form you pay more and get poor QS. 3. You initial min CPC is based on your landing page in relation to text ad and keyword. So yes, you will pay a premium... We have discovered this premium is mostly paid during the first 3 months. By the end of your 3rd month, avg CPC will have dropped considerably. Up to 50% in some cases. This theory was tested on a portfolio, brand new account, unchanged bids, text ads and landing pages for 3 months. End result, avg cpc dropped by 50% by the end of the 3rd month.
@ Robert Priolo My first Google Adwords campaing runs now over one year. In the beginning I played a little bit with the CPC, sometimes I higher it, sometimes I lower it, but now for 5 months I didn't change anything, but I'm still paying the same CPC as from the beginning.. will goole change my cpc (if my campaing is running about 3 monhts) or is it required to change the cpc self if your campaing is running 3 months and if you have to change it yourself after 3 months, how do you know how much you can lower it with still getting the same position?
really interesting experiment. did you keep similar ad position after the 3 months? i'm just wondering as being new to adWords i'm pushing hard to get my ads placed high (so far they are) but the ppc is killing me... i hope my ads too after 3 months prices drop then i'll be really making money
One mistake with the search network is dumping in way too many keywords as a test. The ctr of each ad position is different by nature and an ad in the 8th spot has a snowballs chance in hell of over taking an ad in the 1 or 2 spot as far as ctr goes. You need to get your ad up near the top of the page to start and keep it there. Then once a solid ctr is established, your costs will lower automatically. I've seen it happen faster then 3 months, but if you're ctr is close to the median then it will take longer.
ok, so you're saying it will lower automatically with me having to tweak the price everyday? which is cool.. i've managed to get my ads pretty high and am at about 5 - 7% CTR.. hopefully prices will begin to drop
prices may drop, but you not going to see it overnight... Its takes months to see the big difference when compared to the 1st day of advertising