AdWords is one of the most popular ways to promote a business online. You simply select a few keywords, write a few ads, and send the thousands of people that click on your ad to a landing page where you convert them into a sale. At least, that is the theory. The reality is often very different.

Here are seven common mistakes that people new to AdWords often make. If you are making any one of these errors in your AdWords campaign then it could be enough to ruin your entire advertising efforts.

1) Set A Proper Budget

Like most advertising methods, you have no idea at the start, if your AdWords marketing is going to be a success or not. It is therefore only sensible to be cautious with the size of your AdWords budget at the beginning. You can always increase it once you know if your efforts are going to result in any sales.

However, if you intend to start with a small budget, then you must size your AdWords campaign too reflect this.

Google will attempt to spend your budget evenly throughout the day. If you target too many keywords with insufficient budget to support them, then you will just choke your campaign before it even gets a start to get going.

2) Watch Your Return On Investment (ROI)

If your AdWords campaign is going to be a success, you must watch your Return On Investment very closely. You need to know your margins for every product that you sell. Then ensure that the total cost of bidding on any keyword never exceeds the profit you make.

3) Do Your Keyword Research

All keywords you choose to target must be relevant to your business. If you run a retail web site, then they also should be buyer keywords rather than information keywords. For instance, someone searching for lowest price fishing rods is most likely looking to buy a fishing rod. However, someone searching for fishing rods is most likely still researching their purchase.

4) Write Relevant Ads

Choose the correct keywords and you are targeting the right audience. However, you still have to attract their attention and get them to click through to your web site. This is the job of your ads.

A relevant ad will have a heading that stands out. It will also highlight a feature of the product you are selling, and have a compelling call-to-action. Relevant ads also include the keywords you are targeting so AdWords can highlight them in bold, making your ad stand out even more.

5) Create Dedicated Landing Pages

If you have done your job right, you will now have targeted the right audience with your keywords. You will also have created ads that attract attention, and included a call-to-action to encourage people to click through to your web site.

However, your job is still not finished. Your landing page has to shout out to your potential customer that they have come to the right place and that here they will find exactly what they are looking for.

The headline to your landing page should be an extended version of the headline for your ad. The feature you highlighted in your ad needs to be expanded upon on your landing page. In addition, the call-to-action in your ad must be repeated on your landing page.

6) Check Your Stats

Whilst your AdWords campaign is getting started, check your stats daily. Check your ROI for every keyword and review any that are not making you a profit.

To make your campaigns profitable, consider reducing the ranking of your ads. You can also add negative keywords to make your audience more targeted. Alternatively, try changing your ad copy to make your ads more specific to your audience.

If you cannot make a keyword pay, then do not be afraid to cut it from your campaign, even if it brings you many conversions. There is no point in having $100 of sales if they cost you $105 dollars in advertising.

7) Don't Give Up Too Easily

It can take a while to learn the finer points of managing an AdWords campaign and you will probably make many mistakes at first. It is important that you learn from them and do not give up too soon.

For most online businesses, AdWords is worth the effort and investment. However, you must be prepared to spend a bit at first to learn the tricks. Once you have some experience, you should start too see some profit.

However, you also need to know when to pull the switch on your campaign. The hash reality is that AdWords does not work for everybody. If your ads have attracted thousands of visitors but you have not won a single sale, then maybe it is time to call it quits and try another advertising strategy instead.