Advertising with AdWords VS Overture

Hi there

i am new to e-commerce and I'm thinking of advertising with Adwords or Overture. I want to get some feedback from you experts on how much should I set my cost per click. I have a website that sells phone cards, prepaid calling cards, and international phone cards.

The last time I checked overture, the top bid for keyword: "phone card" is $2.27 per click, meaning if you pay $2.27/click, you will get the no.1 spot. Let's say I set my max bid to $.50/click or $0.25/click, will i still get someone click on it? because $0.50/click means I am on around no. 50 or maybe 70.


thanks guys

You may get clicks, just not that as many...

I've never used Overture so I can't coment on it, but I use AdWords quite a bit. It can't hurt to sign up with adwords and give it a try. You can still get a decent number of clicks by bidding below the #1 bid. How far below you can bid really depends on the search terms and what other people are bidding for those terms. You'll just have to experiment.

What I would do is figure out how much you think you can pay per click and still get a decent return on your investment. For instance, if the average amount you make per order is $10.00, and about 5% of customers who visit your site place an order, then you're making around $0.50 per visitor ($10 * .05 = $0.50). so, assuming you get the same conversion rate from adwords visitors that you get from wherever your visitors are currently coming from (which may or may not happen), you'll break even if you pay $0.50 per click. Of course, you want to make some profit, so in this example, you'll want to set your maximum bid lower than $0.50. Adwords will automatically charge you the least possible amount to show your ad as much as possible, up to a limit of the max bid amount you specify.

Once your ads start running, keep an eye on how much you're spending per click, and how many clicks are converting into sales. (You can track which visitors come from adwords by adding a referral id to the URL you specify and having code in your site to track sales from this referral id, or you can use google's conversion tracking system.) You can fine tune your bids accordingly to find the right balance between getting more visitors and increasing your profit per visitor. Just keep an eye on things to make sure you're not losing money.

Deciding how much to bid, depends on how much you will earn per conversion and how many clicks it will take to get a conversion.

I never recommend bidding for first place. As mentioned above, you wont get as many clicks being listed below the highest bidder, but you will save alot of money.
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thanks for the inputs guys,

I have checked Adwords and it seems cheaper and generate more clicks than overture.

I find that setting my max bid to $0.50/click on Adword would return 20 clicks a day and earn me no 8 position. the cost per click is actually $.33/click.

I also find that setting my max bids on overture to $1/click would only return 142 clicks/month and gives me around no. 40 position.

Does anyone know if the estimate is usually accurate? its strange that google is less expensive, but generate more clicks. it seems that Adwords is much better?