AdWords Auction Insights – Daily Budget

Man Scratching Head
Not getting the performance you want out of AdWords?

Not only is your maximum cost per click a factor in deciding if you are in the Google AdWords auction, but your daily budget may be a factor keeping you out of the auction too!

It is important to understand a few things first about how the AdWords auction works.

AdWords account managers will talk about your 30 day budget spend;  it needs to be high enough to support your accounts daily budget based on your maximum cost per click. Not your average cost per click, but your maximum cost per click.

Here is a fine example of a client who by having a low 30 day click spend has effectively kept Google AdWords from being able to serve his account for best performance.

30 day click spend $150
Daily budget $5
Typical max. CPC for other clients in the same industry $6.50 His top maximum CPC based on his daily budget $5

As his maximum CPC is constrained by his daily budget, his account can never be set at a level to truly be in the auction, he gets spotty click results and sometimes Google cannot even spend his $150 in a 30 day period.

In scenarios like this, what we see happening is that an account manager gets desperate and starts adding broad match keywords to an account in an effort to get low cost traffic.

Here are some of the results we then see when that happens:

30 day number of impressions 11,930
Clicks in 30 days 36
CTR in 30 days .30%
Average position 6.8

It looks like the account is performing, but look at the impressions. They are high and the CTR is low. This account is getting clicks, but they are typically poor quality and untargeted clicks because the client has set the daily budget too low and so can never raise the maximum cost per click to get in the keyword auction. Google may even be delivering clicks at off hours setting the account up for even lower levels of success.

This is just one example of problematic account performance. In some cases as you monitor clients such as this you will even see Google saving up money to try to serve their program by even going a day or three without any clicks at all and then getting a few clicks a day or so later.

If you are looking for a savvy AdWords manager I invite you to read our client reviews. We resolve AdWords problems all the time and do work in some cases on an hourly basis to help re-mediate AdWords problems.

Share