As competitive as we get, sometimes brand keywords are the most overlooked. Brand keywords are also some of the cheapest clicks. Not only that, but if someone is typing brand keywords, they are already looking for your site/products/etc (they are already aware) which is usually why the conversion rate is much higher than other keywords.
Bidding on branded terms can be a great way to get started in cost-per-click advertising. It will keep your costs relatively low while you get used to the system, reporting, and optimizing pages for success.
If your brand is specific, I also recommend using Google’s content network as well so if someone is talking about your product on a message board that has AdSense integrated, your ad will appear.
I hate to pick on certain people and companies, but a great example of a missed paid search opportunity is JohnChow.com. Because John Chow was dropped from Google’s natural listings, not a single natural or paid result will go to his page if you type “John Chow”. Talking about a confusing brand. John boasted in his September blog income report that his revenue off 1 page view was a staggering $.06 and with a per visitor page views of 1.92, John is making approximately $.12 of each visitor. Not bad.
If you assume that the visitor returns in the future or subscribes to the newsletter or RSS feed, you could be looking at a customer lifetime value of well over $10. If John would bid on a few of his brand keywords, he could be capturing 10-50 (guess) targeted visitors a day at a cost of (probably) less than $.10 each.
In short, bid on your branded terms. If your budget is small, $5/day is fine. Just capture high-converting clicks and keep them from going to your competitors.
Dave Rigotti is the owner of Freezing Hot, an internet marketing company which specializes in seo and paid search management for small businesses.