Minimum Adwords Comittment to be Profitable?

[jake321]

I just went through the Adwords TNT course, they suggest for a compaign that is not a nich or local, you have to spend at least $500 a month in order to make any profitable return on your advertising labors. They also mentioned that goog price penalizes compaigns running for less than 2 months. Are these indeed factors effecting the cpc?

I have seen discussions of target page/site quality effecting cpc, apparent goog wants to encourage quality user experience even when you've paid for them, perhaps the ultimate factor they should track is the conversion rate, buying what they were searching for seems like the ultimate sign of satisfaction.

 

[gorlock]

You may not have to consistently spend at a certain level (depends on the campaign characteristics), but I would say that with any campaign you should bid high early, and then consider tapering things down as the campaign matures. Higher bids help establish quality score early, and literally buys you time to refine creative, keywords, and landing pages. As the campaign ages your quality score will improve due to these refinements, and costs will go down (as Goog rewards relevancy and higher qs). Gradually you will get to know your campaign and you will see places where lower bids help costs without a severe affect on performance.

 

[gorlock]

trying to answer your question better: I just think it's wrong to say $500 is required to be profitable. It's all a matter of finding what works with what you're selling. $50 could be profitable, or $1000, you don't know until you run the campaign and get some data.