How to Make the Most of a Limited AdWords Budget?

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When speaking to business owners who are new to search advertising, a common concern is that their marketing budget is simply not big enough to compete with some of their competitors who are investing huge amounts of money into their marketing efforts. If this sounds like you, then I have some good news for you!

Although having a large AdWords budget will help you to achieve results much faster, there are still ways in which you can set up your AdWords account to perform well with even the smallest budget. Below are some ways in which you can get the best possible results out of a small AdWords budget:

Target Lower Ad Positions

Many advertisers tend to target the first one to three positions on Google based on the belief that these are the only ads that will be clicked on by Google users, when in fact this is not the case at all.

Adverts in positions 4+ still obtain traffic, often at a much lower CPC (Cost-Per-Click) price than the higher positions. Furthermore, for some industries, these lower positions can even convert better, as well. This is due to the fact that sometimes the top positions will attract a lot of “tyre kickers”—that is, people who really aren’t interested in making a purchase at all and just clicked the first Google listing they saw.


Target Only Specific, Long-Tail Keywords

If your AdWords budget is extremely limited, the importance of using only the most targeted and specific keywords is much higher than usual. In general, specific long-tail keywords (keywords made up of 3+ words) that describe your exact services are much more likely to convert compared with broader, single word keywords.

For example, if you were an AdWords agency looking to attract more customers, you’d probably want to focus on terms such as “AdWords agency Sydney” rather than a keyword like “AdWords.” This is because a person searching for “AdWords agency Sydney” is obviously only looking for one thing: an AdWords agency in Sydney.

However, someone searching for “AdWords” in Google could be looking for a range of different things; they could be looking for information on AdWords, a blog, the AdWords login screen etc.

Create Specific Campaigns for High-Converting Keywords

One of the biggest mistakes made by business owners running an AdWords account (see this article for a full run down on common problems found in self-managed campaigns) is only creating single campaign for all of their campaigns. This can create many problems, one being that it groups all of your traffic under a single budget cap each day.

If you’ve got broad, highly popular but low-converting keywords within the campaign, then there’s a chance that these keywords will obtain traffic very quickly, exhausting your budget before any of your other keywords can a chance to obtain traffic. Because of this, it’s recommended that you dedicate at least one campaign for only your high-converting keywords. This will give your high-converting keywords their own dedicated media budget, which should allow for more conversions overall throughout the day.

Avoid the Display Network

While the display network has the potential to drive huge traffic volume and expose your brand to a massive audience, conversion rates seen in this channel are generally nowhere near as high as what you’d see from search traffic. Because of this, if your budget is limited then it’s probably best to disable the display network.

Analyze Location Segment Reports, Then Refine Geotargeting

Thanks to the extremely granular reporting provided by AdWords, you’re able to quickly identify which cities and states your traffic is coming from. If you’ve got conversion tracking installed on your account, then you’ll also be able to see which areas are delivering conversions.

To maximise your conversion rate with a low budget, it’d be a good idea to monitor this report about once a month and exclude any areas that have poor conversion rates compared to other areas. You may even want to create specific campaigns that target only your highest converting locations, too!

These points should help you get the most from your limited AdWords budget. However, the most important thing to do to ensure you’re getting the best results possible is to pay close, regular attention to how every aspect of your campaign is performing. Ensure that campaigns, adverts, and keywords are analyzed regularly and optimize your account according to the data you see.

Do you have any other tips or ways you work with limited budgets? Please leave in the comments below!

Jeremy Decker
Jeremy Decker is the SEM manager for Australian Google Adwords & SEO agency, Click Click Media. Jeremy joined Click Click Media in late 2011, after spending 5 years in top Online Marketing agencies running large scale search marketing campaigns for well-known brands such as Apple Australia, Yellow Pages, Flight Centre & much more. His extensive Search Marketing experience, along with his keen thirst for knowledge regarding all things online makes him a great addition to the Click Click Media team. Find him on Twitter @ccmadwords
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  • Zane

    Hi Jeremy,

    Excellent post about Adwords, I have been using Adwords from many years and It seems that you have given a great Idea about getting quality traffic from Adwords. The best point which I like from your post is that you have described to target ” Lower Ad positions” , I have never tried this position before and i am always looking to get on top 3 which cost me a lot. I will try that position for sure.

    Also I have been also targeting exact long tail keywords for my business. Long tail keywords are best to get traffic on really low CPC . 😉

    Thank you


  • Sha Menz

    Hi Jeremy,

    Excellent post!

    I have a couple of clients who are running their own adwords accounts with very limited budgets and have had a few lengthy conversations with them about wasted ad spend in the past. Unfortunately, it is difficult to shift them from the idea that you use Adwords just to get the high competition head terms that they struggle to win organically. Nice to see you talking about the long tail here & I’ll definitely be sharing this with them.

    Thanks also for the tip on fine-tuning according to location..for one of my clients, interest for the product (hunting accessories)seems to come from a number of very specific locations and I think this could be quite useful for them.

    We don’t offer Adwords as part of our services because we understand the need to really know your stuff in this area, so it is nice to have some great information to pass on to those clients who have made the decision to try their hand at running campaigns themselves.


  • Mark

    It’s amazing how many people are focussed on getting top 3 results in AdWords. The number 1 focus should be to get as many quality clicks as you can from your budget. Being in the top 3 frequently means that you get say 10 clicks for your £10 budget, but being in #5 or below you might get 20-30. It’s a no brainer.

    • Jeremy

      Hey Mark,

      To be honest I don’t even think clicks should be a focus – more conversions. If I can get 5 clicks a day with 3 of them converting into a sale or lead, I’d much prefer this over getting 20 clicks a day and none converting into a sale or lead. Sometimes positions 1-3 can convert better which justifies the higher CPC but this isn’t going to be the case for everyone – this is why experiments are so important!

      • Mark

        You are right that the top 3 can convert better in some cases. However, in my experience, the vast majority of campaigns that I have run had a lower ROI in the top 3 – i.e. more budget was spent, but revenue would not increase by the same multiples. It’s important to test, but in the vast majority of cases, if you get more clicks keyphrases that match users’ intent, you’re more likely to get somebody that converts.

  • Mark

    Sorry to post again, I forgot to mention your point: “Target Only Specific, Long-Tail Keywords.”

    This issue with this is that Google make it hard for you to do that. Quite often you’ll get a message to say that a particular phrase has a “Low Search Volume” and therefore it won’t show your ads for that phrase. For example, to pick a phrase off the top of my head, “Responsive Web Development London” apparently has too few searches to show. Seriously?! This is frustrating if that phrase accurately targets your precise audience, however small it might be. Thus, you have no choice but to go with more generic terms that bring in a few noisy clicks.

    Clearly, Google doesn’t want to allow people to bid on non-competitive phrases, as this means that CPC will inevitably be lower. Google want to condense the market to maximise competition and AdWords revenue. I’m not saying you literally can’t bid on longer tail phrases, of course, but this can be harder than you might anticipate when you first set out.

    • Jeremy

      This definitely can be frustrating. When mentioning location within keywords, I usually try and avoid being too specific as the “low search volume” problem can occur. Using your example, I’d stick to keywords like “web development london”, “web development firms london” etc. and then have another campaign for keywords such as “responsive web development”. You could set this keyword to broad match modifier and then analyse your search query reports to determine whether there are any location-specific searches being made using this keyword, and then add any that you come across as keywords in your campaign. This way you’ll have some long tail keywords that you know for sure are getting traffic.

      • Mark

        Hi Jeremy,

        Thanks for taking the time to reply and I appreciate your advice. What you described is is exactly what I have done. I probably should have dug for a non-location phrase to illustrate my point better – there are a few that surprised me! However, in this case, I was able to set up campaigns that are restricted within a certain radius around London. It basically does the job! However, I did set up another campaign for a dog clothing (!) affiliate site a while back. In that case, I couldn’t have “tartan dog jacket” – with the margins available, the only way I could have made profit would have been to bid for highly targeted terms. Can certainly be frustrating!

  • Dudley Antoine

    People are so heavily focused on being in the top 3 positions that they tend to lose focus on overall strategy. Top three will bring in volume but volume doesn’t equal conversions. I’ve noticed that if you work diligently on getting the same product or service ranked in the top 4 of organic results you will generally see lower CPCs over time . An ad in a 3rd or 4th position(side bar) will be eye level with your organic result. which builds familiarity with end users. You may not get huge amounts of traffic but you will get quality clicks that could lead to more conversions. Just something I have noticed over time….

  • Alan Mitchell

    Hi Jeremy,

    I agree with your point that long-tail keywords can be very effective for campaigns with small budgets.

    I recently wrote an article sharing 3 techniques I find useful for researching these long-tail keywords (

    Theme analysis picks out themes from search query data, broad match generation uses broad match keywords to generate new long-tail keywords, and the 10% clicks rule prioritises areas of long-tail weakness within your campaigns.

    Also agree with your point on refining geo-targeting – this can be easily overlooked and can quickly and unnecessarily chew up budget.


    • Jeremy

      Hey Alan,

      I like the article! Those are some great tips on how to make use of search query data.


  • Notjusttaps

    Hi Jeremy

    You are right to focus on targeting lower ad positions but I would add one key point…..Negative Keywords!
    You’ve got to use them throughout any campaign to reduce wasted clicks

    Thanks for the article


    • Jeremy

      Great point. Negative keywords are a fundamental part of any campaign – large or small!

  • Martin Eising

    Super post. I am in a similar situation. Ad positions of 5-7 still generates a fair amount of traffic, enough so that our budget is being maxxed out. Why not drop bids until a daily budget is just being reached? Like the article states, lower ad positions is alright. I have seen slightly lower conversion rates for very low ad positions, but the difference in CPC far outweighs that.

    Weekly Search Query Reports identify possible negative keywords as well as having wrong ads display for a given key phrase.

  • Patrick

    Great article Jeremy! We are a new brand of skin care products (very competitive keywords) and have just started to ramp up our Search Network ads (very limited).

    Now that Google has changed their Shopping / Product listing, do you have any recommendations for products like ours on creating Product Listing Ads for Google Shopping?


    • Jeremy


      Unfortunately Google don’t allow you to be very creative when adding products to Google shopping – the important thing is that your listings are completely accurate otherwise you’ll have problems getting exposure on Google’s different properties.

  • Brian

    Thanks for the article. My clients often start with small budgets on adwords so this is helpful.

  • Adam

    I’m brand new to Adwords (aside from a quick free trial of Adwords Express) and have a very limited budget at the moment. This article was exactly what I was looking for – thanks!
    Someone also mentioned putting the longer phrases in brackets to prevent Google chopping them up? Is that the case? Apologies in advance if that is a stupid novice question!

    • Jeremy

      Hi Adam,

      Glad the article was helpful!

      In regards to your question, the person you’ve been speaking to has recommended a match type called “phrase match”. This is a great way of ensuring your campaign is highly targetted but it will reduce your traffic volume as well. There’s another match type called “broad match modifier” which i usually prefer to use. check out the differences between the two match types on Google’s help pages.

  • maria

    I run Geo-targeted campaigns for example, in Abilene, TX, with a radius of 30 miles , my Ads CTR is about 1.60% but it seems i dont get enough overall clicks daily, what is a normal amount of clicks for such a campaign and how can i increase my traffic?

  • David Phillips


    Thank you for this. I implemented the lower position strategy and began getting MUCH better qualified click-throughs and was able to convert at a much higher level. My company offers IT services to businesses and when we were listed in the top three spots, we were getting a bunch of responses from people wanting service in their home for about $10/click. Now we are getting fewer calls from home users and converting at a much better rate for about a third the cost per click.

    Thank you,


  • Barcodes UK

    Thanks for this. It is helpful. We have limited budget to promote and sell our retail barcodes. I will look into the geo-targeting more.