One is my daily revenue goal.

The other is “Read Amit”.

1. Building history up with CTR, so therefore you can get lower click cost.
2. Your findind out what keywords convert.

If your really good you can tell what keywords convert with out even using a keyword conversion code like a lot of arbitrage marketers do where they profit off the market imbalance by combing multiple adwords ads on landing pages.

I reread what you said and yes you are wrong chances of you making any money or getting any clicks at all are next to none the idea is to bid high in the beginning stages with a good placement that is getting good CTR even if your losing money, but at the same time ultimately bidding down while maintaining the same position then eventually you will hit the profit state…

See your looking at it like I’m going to throw a campaign up and starting profiting right off the bat with out investing money in the beginning stages it just don’t work like that specially when using new keyword list.

Thats the biggest problem with people trying to make money they don’t understand they have to invest, invest, and invest before they start to make money the same thing is with organic search people want rankings and want traffic, but they don’t want to invest any money into it, it just makes no sense to me….

Anyways its pretty much common sense…

1. find what keywords convert
2. maintain good position with good CTR even if your losing money in the beginning stages.
3. after you have collected data start bidding down until you hit a profit state

I mean how hard is that?

My conversion ratio is actually higher then that, but thats besides the point the point is you will lose money on a new account most generally you will sometimes you can lose 1000′s of dollars when you start a new account with new keywords your looking at it from the wrong angle.

The bottom line is you will lose money in the beginning stages well I wouldn’t say lose, but your not going to throw a campaign up and start profiting right off the bat on a new account with a new keyword list if thats the case then I’d like to see that, but the chances of that happening are rare because in the beginning stages you are building up your history while bidding down.

Anyways enough of that I think I let the cat out of the bag enough there…

I already knew all of the information that you posted but never really put it together like that. That was definitely a light bulb moment for me. Thanks for spelling it out for me! HA!

~Debby

Your commission is $15 for order. If your conversion rate is 1% it’s mean that you must have 100 clicks to have a single order, if your bid is 2.24, you must spend $224 to get one sale. So your will loose $224 – $15 = $209. After some time your bid dropped to $1,24! If conversion rate is the same 1%, you must spend $124 to get one sale which will bring to you $15 commission. So now you still loose money: $124 – $15 = $109!

I think $0.15 bid is maximum bid which I can setup if I don’t want to loose money. When I want profit, bid must be lower then $0.15, when conversion rate (1%) and commissions ($15) are constant.

Or I’m wrong?

P.S English is not my native language, but I think you understand me