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Choose your bid and budget

To run your ads on Google, you'll need to decide on the right budget and bidding options. Your budget establishes a charging limit for an individual campaign, so it should be the average amount you'd be comfortable spending per day (or seeing on your monthly credit card bill if you multiplied your budget by 30.4, the average number of days in a month). Your actual costs may be lower, depending on how you manage your bids.

Your maximum cost-per-click bid (max. CPC bid) is the most you're willing to pay for a click on your ad. By managing your bids, you may influence the amount of traffic your ads receive, as well as the Return on investment (ROI) they generate. With higher bids, your campaign is likely to receive more traffic, although you'll likely spend more money. With lower bids, your campaign is likely to receive fewer clicks and conversions.

This article explains how your campaign budget works, discusses different bidding options, and explains the steps you’ll need to take to set your bid and budget in a new campaign.

How campaign budgets work

Your budget amount is for a single campaign (as opposed to a total amount across all your campaigns), and it represents the average amount you're willing to spend per day in that campaign. If you want to check your average daily budget across all campaigns, you can use the "Budget" column under the Campaigns tab. If you prefer thinking of your budget in monthly terms rather than in daily terms, you can calculate your monthly budget by multiplying your average daily budget by 30.4 (the average number of days per month).

Tip: Start small

If you're a beginner, try a daily budget of US$10 to US$50. Check your account daily after applying a new budget to see how your campaigns have performed.

Overdelivery

Because traffic fluctuates from day to day, Google may allow up to 20% more clicks (or other ad activity for campaigns on another bidding option) in one day than your average daily budget specifies. We call this overdelivery.

However, our system makes sure that in a given billing period, you're never charged more than 30.4 multiplied by your daily budget amount. For example, if you budget US$10 per day, the maximum you would pay is US$304.

If Google shows your ads too often and your costs for the month end up exceeding what you should have paid in a month given the daily budget you've set, an overdelivery credit will automatically be applied to your account. For instance, if your monthly charging limit is US$304, and you've accrued US$310 in costs in a given billing period, you'll receive a credit for US$6 and only be charged US$304. You can see these adjustments on your Transaction history page.

Tip: View your recommended budget

Are your campaigns using up all of your budget? Your budget settings include the option to View recommended budget, which is based on analysis of your campaign performance, typically from the past 15 days.

Bidding options

When many people think of an auction, they often think of a prize being sold for the highest bid. But our ad auction uses both quality and bid to determine your ad's position. So even if your competition bids higher than you, you can still win a higher position—at a lower price—with highly relevant keywords and ads. You'll often pay less than your maximum bid because you'll only pay what's minimally required to hold your ad position and any ad formats shown with your ad, such as sitelinks. The amount you pay is called your actual CPC.

There are many different ways to set your bids, including an entire suite of automated bid strategies. But most people start out setting their bids with either Maximize Clicks or Manual CPC bidding.

Maximize Clicks vs. Manual CPC bidding

If your goal is to gain clicks to generate traffic to your website, there are two cost-per-click bid strategies to consider:

  • Maximize Clicks is the simplest and most commonly used bid strategy. All you have to do is set a daily budget, and the AdWords system automatically manages your bids to bring you the most clicks possible within your budget.
  • Manual CPC bidding lets you manage your maximum CPC bids yourself. You can set different bids for each ad group in your campaign, or for individual keywords or placements. If you've found that certain keywords or placements are more profitable, you can use manual bidding to allocate more of your advertising budget to those keywords or placements.

Tip

Try Keyword Planner to get traffic estimates, like estimated clicks, estimated impressions, or estimated average CPCs for your keywords. These estimates can help guide your decision on which bids and budgets to set.

Bid adjustments

You can set bid adjustments that increase or decrease your bids when your ad is competing to appear on mobile devices, in specific locations, and at particular days and times. Bid adjustments can give you more control over when and where your ad appears, and are applied on top of your existing bids. You can also customize your bidding strategy by setting multiple adjustments that work together, such as location and time of day, or time of day and mobile devices. Learn more about bid adjustments and how to set them.

Set your bid and budget for a new campaign

Set your bid and budget

  1. Sign in to your AdWordsaccount.
  2. Click the Campaigns tab.
  3. Click the + Campaign button and choose a campaign type from the drop-down.
  4. Scroll down to the “Bid strategy” section and select a bid strategy.
  5. In the "Budget" section, enter your budget amount. The amount you enter should be the most you're willing to spend on your campaign on average per day over a month. You can also apply a shared budget that you've previously created in the Shared library.
  6. Click Save and Continue (on the next settings page, you'll be prompted to create and save your ad group).
  7. You may edit your bid strategy and budget again at any time by returning to your campaign's Settings tab.
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