When setting up a pay-per-click (ppc) advertising campaign like Google's Adwords it is vital to design each ad around the right keywords. Of course this is common sense. Many advertisers and marketers have made an art form of choosing the right keywords. With careful market research and search engine keyword data they can create a list of productive keywords.

The rub is that keywords are not the only factor is making a ppc ad campaign a success or failure. The truth is that internet surfers don't practice the patience that tv or radio consumers do (that is not saying much either). When a search term is entered into the search engine many pages of results will show up. The reality is that only the first 5 or maybe up to the first 10 pages will be seen by the searcher until their attention is caught by something else.

This means that for an advertisement to be viewed by a good number of viewers it is going to need to be among these pages. How can an advertiser ensure that their advertisement is among these pages? As with all things in life it comes down to money.

Anyone who is familiar with the workings of AdWords can skip over this next section; however, for those unfamiliar with how AdWords works it is essentially a giant auction.

Being the only advertiser using a particular keyword is not a very probable thing to happen, except if it is a word or phrase that is not very well known or well used and won't attract very many visitors. Since the main idea for advertising is to get interest and visitors you would not want to really use these keywords.

This means that there are going to be other advertisers using each keyword. How does the search engine determine whose ads will be displayed first?

Each time that an AdWords ad is selected the advertiser is charged a fee. This fee is generally small, less than a dollar, but will cause costs to rise quickly.

Therefore, the advertiser using a keyword that is willing to pay more per click than the other advertisers using that same keyword is going to have their ad placed at the top of the list. It's good business on the part of the search engine; they get their money whether the marketer makes a sale or not, and an advertisement which pays them fifty cents each time it is selected is going to bring them greater profits than one which pays twenty five. They want the higher paying ads to be selected more and therefore will place them in an area which is more visible.

Balancing your bids and keywords takes time and effort. You will make some money and lose some. Never forget that you will not have a sale with each click. Most likely you will get a sale in only one out of 10 clicks. That is the probable sales percentage. With you product price, budget allotment and this percentage you can figure up how much you can afford to bid for your keywords.