how much should you pay for keywords?
Every keyword has a break-even point: bidding any higher will deliver an unprofitable return. Thus, to succeed with paid search, you must have an intimate understanding of your break-even point.
Clearly, it's important to have the right keywords, effective ad copy, and a persuasive and optimized Web site experience, but none of this matters if you do not know how much you should pay for a keyword.
We plan and buy all paid search campaigns relative to conversion and ultimately return on investment.
This may be an obvious statement to make, but in June 2005, Jupiter Research reported that 75% of agency buyers did NOT bid for clicks based on revenue. Even worse, only 5 percent bid on keywords based on the profit those keywords were generating.
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