Response From Google AdWords About $39 click

I had blogged last week about a legal client who made the mistake of setting his bid to high for the term "chicago estate planning lawyer" and got charged $39.52 for one click. 

I got a response from Google adwords (see below)and like I thought there's nothing that can be done because of the fact the maximum CPC (cost-per-click) was set so high and other variables were in play.  Once I took over the account, I was able to reduce the max CPC and got the click charge down to $1.30 per click, from $39 per click. 

Here is the response from Google Adwords:

After reviewing your client's account, I found the keyword 'chicago estate planning lawyer' was charged $39.52 on April 3, 2005 because his maximum CPC was designated at $39.88. He was charged a lower amount of $1.30 per click this month because his maximum CPC is currently set at $2.00. These clicks are not charged the full designated maximum CPC because our AdWords Discounter automatically keeps your actual CPC at the lowest possible cost needed to maintain your ad's position on the page.

Additionally, the position of your AdWords ad varies per keyword and is determined by various factors such as your maximum cost-per-click (CPC) for the matched keyword, your clickthrough rate (CTR), and your ad text in relation to other advertisers' CPCs, CTRs, and ad text. Because Google AdWords doesn't rely solely on your CPC bid to rank your ad, it is not possible to know what your competitors are bidding.

The bottom line here though is that if you set your max cost per click so high and have competitors that are also bidding high, there's a very good chance you will overbid. 

I usually start with a lower bid and then see how the keywords perform and then raise the bid when needed. Google adwords is more complicated and harder to manage then Overture (now Yahoo Search Marketing) but much more effective, if setup and managed correctly.