I recently did an experiment in Google AdWords with one of my client’s accounts to see whether we could lower her CPC (cost-per-click) bid and actually generate more traffic. She was hitting her daily budget limit and couldn’t afford to increase her budget. So we tried an experiment to see if lowering her CPC bids could increase clicks. Read more to see the actual results.
The client’s daily budget was $7.00 per day. She was hitting this budget before the end of each day, and therefore her ads would stop showing. We decided to run a two week experiment in the first half of November and cut all her bids in half. Then in the second half of November, we raised the bids up to halfway between the current amount and the original amount. Here’s an example:
Oct 1 – Oct 31Â bid was $2.00
Nov 1 – Nov 14 bid was lowered to $1.oo
Nov 14 – Nov 25 bid was increased to $1.50
This should give you the general idea of what we did. Of course each Ad Group had different bid prices, but we followed the same algorithm of cutting in half, then raising halfway.
Here are the results:
A comparison of the total cost for the three time periods. You can clearly see the budget being hit in October, and then it not being used in early November because we had set the bids too low. When we raised the bids up in mid November, we again were able to use up our daily budget.
Next we’ll look at a comparison of the cost per click (CPC). See how the average CPC was lower in early November, higher in later November, and still higher in October.
Now for the final comparison numbers. This chart compares two weeks of the baseline period Oct 1 – 13, to the final two week test period, Nov 14 – Nov 25. Notice that the final period had 17.1% more clicks yet the total cost was reduced by 11.9% and the CPC was reduce by nearly 25%! Let’s repeat that, we paid 25% less but got 17% more clicks.
Amazing isn’t it? So if you’re hitting your daily budget, you can try this yourself.
Lower your bid prices by some amount that you think will actually cause you not to use up your daily budget. For this experiment, I picked 50%, but your case may be different. Then, once you’ve lowered the prices too much, raise them back up and do the comparisons for equivalent time periods. If you’re fortunate like we were, you may be able to find a sweet spot, where you actually get more clicks but are paying less for them!Jill
Aldebaran Web Design, Seattle
Jill Olkoski has a BS in Engineering, a BS in Computer Science and an MA in Clinical Psychology. She delights in using her advanced technical and psychological skills to help small business owners develop cost-effective and successful websites.