Google charges you on a CPC ("Cost per Click") basis - you only pay for each clickthrough to your web site from Google's, no more no less. You don't pay for "impressions" (number of times someone views your ad) like many first generation Internet advertising models - it's truly a results driven marketing process.

Keywords costs can vary tremendously ranging from $.05 to $11. USD or more per keyword - Google assigns a "minimum cost per click" for specific keywords based on "market value" and "performance history" via Google's AdWords Select program history. Be prepared to pay a much higher rate for very popular keywords and this is a moving target all of the time - the more popular this program becomes the more you will be forced to pay for selected popular keywords.

Your Ad's position is based on a combination of the CPC ("Cost per Click") you selected and relevancy of your ad - if your ad and keywords are relevant and drive clickthroughs, then your ad will rise in position on the sponsored column versus your competitors. This is an innovative feature and helps to distinguish Google's program from all other PPC ("Pay per Click") campaigns (Overture and their primary competitors) - most of these programs have an "economic bias" built into them; i.e. whoever pays the highest fees gets the top placement.

Google's unique AdWords Discounter keeps track of your costs per click versus your competitors. You select the maximum amount you want to pay for your keywords and the ranking algorithm keeps track of your keyword costs, ensuring you only pay one cent above the CPC ("Cost per Click") cost you specified when you setup the campaign versus your competitors.

AdWords Select is based upon driving highly targeted traffic to a web site via a set of keywords that are selected via Google's account management interface. There are two primary components to the setup process, creating your "sponsored link" ad and selecting your keywords. You start by creating a "sponsored link" ad that is subsequently inserted into Google's search results on the right hand column - targeted by keywords that you have selected. It only takes a few minutes to have your campaign go "live" after you've completed the setup process.

It's very important to spend quality time creating your sponsored link as this is the "online ad" that people will view in the midst of search results and competing sponsored links (in some cases). You have the ability to create a short headline coupled with two lines of text with approximately 35 characters per line - the headline must be succinct and hard hitting and the related text should backfill the headline with supporting words that convey what goods or services your company provides.

Keyword selection can be the most daunting task for setting up a new campaign - be prepared to spend some focused time working through multiple keywords to find those that you can afford. It typically takes 1-3 hours to find 10-20 keywords that are relatively low cost - however, if your budget is open-ended and you have sufficient marketing funds to pay $1-8. USD per keyword then it can take much less time. Your market focus is also another important variable that can impact the keyword selection process - if you're in a narrow market niche with only a small number of competitors then it is much easier and faster to setup a campaign.

Finally, be aware you can find some keywords that are very inexpensive, but Google will disallow these if they don't drive a minimum clickthrough amount of roughly less than 1% - you can start off with them, but they will be turned off after 7-14 days if they aren't driving sufficient clickthrough volume.

You may want to utilize other keyword analysis tools that will give you a broader selection and help you to understand what keywords are popular and searched on, which in turn ensures the keywords you do select will drive traffic and will not be disallowed by Google. Wordtracker (www.wordtracker.com) is an industry standard keyword analysis tool that those of us in the online advertising world (and many others) have used for years to help us understand what keywords are popular - their service is very low cost and easy to utilize via their web site.

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