Newbie concerned about overbidding

[turbojoe]

I'm currently developing a Health Insurance website to generate
new sales leads and provide information to consumers thought
Pennasylvania. I need help with my initial Pay per click bids.

I Have no idea what my inital bids should be and was wondering
if anyone has a particular strategy that has worked for them.
I would like to appear somewhere in the middle of the sponsored
links section.(Google,MSN,Yahoo,Aol,Ask) My monthly budget will
be between 1000-1500.I was quoted 250 clicks for 500 dollars from
a search management company and that seemed very high. 2 dollars
a click and I'm not even certian how many of the clicks will be
converted into sales leads. Any ideas or suggestions would be
sincerely appreciated.

Please help!
Joe

[Kevin Heisler]

Great question. It's tough to say whether $2 per click is high. As you note, conversion rate will determine whether you're paying the right price per click.

Do you have a pretty good idea of what the value of each lead is for your business?

In other words, what would you be willing to pay for each lead if, for example, you paid a referral fee in the offline world? It might be a number calculated simply: i.e. the cost of a chamber of commerce membership divided by the number of leads you received over the course of a year. The right price for you reflects the value of the lead to your business.

It's okay if you don't know the exact cost per lead you're shooting for. Lots of folks face the same problem and solve it by experimenting with different bid prices.

If you're planning to invest $1,500/mo., you may want to manage your own campaign first - before considering whether to outsource to a search marketer. You won't necessarily get better results, but you'll have a better understanding of what works and what doesn't.

I'm sure there are forum members who'd be glad to share ways you can day-part your campaign: bidding for short periods of time when traffic volume (the number of searches resulting in clicks) is high. Ultimately, you'll want to back your cost per click into a CPA, or cost per acquisition. That way you'll be managing the campaign based on ROI rather than average cost per click.

There are lots of interesting ways to manage campaigns yourself with third party tools available in small business CRM systems, like Salesforce. The key is to track clicks all the way through to the lead, and eventually, the sale.

I'm sure members of the forum community will be able to help you with more info.

Kevin (exec editor of search engine watch)

[NewKidOnTheBlock]

Hi Kevin,

Ive never done any adwords advertising myself, yet (just an SEO trying to get a better understanding of PPC for the long run and lurking ;)), but what you said about day-parting a campaign is very interesting.

Can you run your campaigns only during a certain time of the day?

How would doing this help your campaign if you're only considering traffic volume, though? It would obviously be a more careful approach (but then why the need to do it when traffic volumes are especially high?). Sorry for asking these beginner questions, but I found this day-parting thing really interesting!

Would it be possible to check when during the day conversion rates are best? Possibly different demographics surf the web (even in the same vertical) and one could get better results (for high volume terms) by focussing one's campaign on the hours of the day that have the highest conversion rates/highest quality traffic?

[Ryan L]

Just jump in, experience is the fastest way to learn.

Make sure you set up analytics and conversion code, they're provided free from google and the data you'll get is invaluable. Its detailed how to set it up step by step.

Yes you can run it only certain parts of the day, At first I would start out running 24-7 full throttle, then as you see what converts you can narrow it down; based on keywords,ads, locations and times.

You can also set up localized adwords so that say people within 300 miles (just an example)are served your ads if your concerned about only serving places that your licensed to sell insurance.

$2 a click is sort of cheap actually, some competitive keywords are in the $20-$30 a click range.

Also for checking what time of day conversions happen, I don't believe that any of the free google tools will do that. You'll need to look for an outside solution, or report that internally using a phone call tracking solution such as who's calling or a time stamp on your commerce solution.

[beu]

Welcome to SEW turbojoe!

This is all good advice, one point I would add is to use caution when it comes to "big terms". Just keeep an eye on things in general. Your industry is unique in some ways and it's best to avoid any chance for suprises. It's never fun to spend $15k in a day on one term but it happens!

[Ryan L]

good point, make sure to set up a daily budget in your adgroups.

also make sure that you are careful with your decimal points.

[abbottsys]

Lead generation eh, and in healthcare to boot. It's all pretty much straighforward:

1) make sure you have the conversion adwords tracking code in place, so you know your cost/lead. Without this you're shooting in the dark.

2) write your and, and don't forget to geo-target to PA only. Ypu have a very small budget, so geo-targeting will help preserve it.

3) write your ad, run it, and adjust your bid until you're in the middle of the right side.

4) monitor # leads, and cost/lead

5) adjust as needed