Google AdWords Bidding Tutorial

Our Chief Economist, Hal Varian, explains the how to adjust your bids to maximize the profit from your marketing investment on AdWords.

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  2. TriggerManEAP says:

    great video

  3. PhLisaME says:

    @MrEspozita it’s not calculated this way. look at the values of each click at the $5 bid – they do not correspond to A,B,C in the $4.50 bid.

    So to get $10.30 he subtracted the totals ($21.60-$10.30) and then divided by 2.

    so the Maths holds.

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  6. AdvertiseLocally says:

    @x2xHalox2x No, this is considering your wholesale COST not advertising cost AND if your ads are converting you can pump it out BIG TIME!

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  8. sunofegypt says:

    Great way to explain such a process, but i would like to understand why is it that complex? Why doesn’t Google figure out an easy way for us to do this? The majority of people advertising at Google do not get into this much details. They just want their Ad’s delivered at a price within their budget ranges. They do not need rocket scientists to do this process for each product they have! Suppose i have an eshop with hundreds of products. I won’t be able to repeat this process for everything!

  9. MrEspozita says:

    Did the Chief Economist of Google really just say that $4.50 + $4.80 = $10.30?!?!?!?

    Google’s making it so fast they forget how to count…

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  12. thatexactly says:

    great video

  13. thatexactly says:

    This video has some great tips, check out my blog for more tips on Adwords and feel free to comment.

  14. beneeB says:

    in this example Google is making over 20% of the sale. Pretty nice margins for Google for doing Nothing

  15. steddes says:

    @cabbagedavidge – about the figures. You have a max bid on $5 but that is not your actual cost. Your avg. cpc is 3.35 which is the amount you times with numbers of clicks. Which gives you the exact cost

  16. cabbagedavidge says:

    Only question, on the graph where you show bid $5 – Clicks 208 – Cost $697.42 etc How did you arrive at the figure of $697.42?
    Thanks for any help with this.

  17. cabbagedavidge says:

    Your presentation was a great way to help understand. Thanks for such clear easy to follow explanation. I have grappled with trying to understand Adwords bidding, you have now made it so much easier.

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  19. MrLakiwi says:

    Because you’re a broke ass fool

  20. NewGameReleases says:

    4 dollars for one visitor? lol i’d pay like a penny haha

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  22. FreethinkR08 says:

    There is a reason why that comment was deleted. Why don’t you address how you’re making a profit if you are paying $100 per conversion at a sale price of $300, and your wholesale cost is $200. Address that.

  23. josephclawrence says:

    I read your other comment, and you clearly understand the video less and less the more you watch it. None of the statements are contradictory. You rarely pay the full maximum CPC bid for a click, which is why when you bid $5 you would at worst break even, but probably turn a profit. This is not contradictory to saying that if you paid your full CPC max bid of $5 you would be breaking even.

  24. josephclawrence says:

    This is just a semantic question – Hal is calling revenue the money you generate from the sale before you factor in the cost to you for the advertising

  25. FreethinkR08 says:

    Paying up to $100 for each conversion would lead to a break even scenario. He says at this point you can still make a profit on the sale. I highly doubt this guy works at Google, they wouldn’t hire someone this incompetent.