Managing Your Search Engine Advertising Budget: How Much is Enough?

- January 18, 2007

So you want to show up in the top results within the search engines? The question is, are you willing to pay for it? Whether you are new to Search Engine Marketing (SEM) or a savvy online advertiser, setting an appropriate budget can be a difficult task without a strategy in place. I have found through experience that many firms setting new Cost per Click (CPC) budgets are simply shooting in the dark.

A common recommendation is to set a testing budget and monitor your results. This flexibility allows you to find the right budget to maximize your ROI. Keep in mind that bidding for first position is not always as profitable as lower priced positions. By using the following tools, you can investigate keywords and bid prices to come up with the right budget for you:

Google Adwords Keyword Tool
Yahoo Bid Tool

I have worked with several companies that found through this testing process, whether increasing their CPC bids or monthly budget, they actually produced a higher return on their investment. Remember there is no perfect solution, and the more flexible you are, the more open you will be to online success.

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