Segmenting Keywords by Match Type
In Chapter 7, we show you how to create your first campaign. If you begin in the Search network, our advice is to use exact match keywords only. The great thing about exact match is the amount of control you exert over the traffic; you're getting just those searchers whose search terms clearly represent desires that you can fill. You can expect your CTR and ROI for exact match traffic to be higher than for any other type of traffic. That makes it a logical place to start advertising. Only after you achieve comfortably profitable margins with exact match campaigns does it make sense to venture into less restrictive match types.
The downside about exact match is that it limits the amount of search traffic Google will send you. So after you have exact match working, it makes sense to expand into the two other match types: phrase and broad. These match types give up some control and transparency (you can't always know what search queries are triggering your ads anymore) but in exchange gets more traffic. Google is now bird-dogging searchers for you, based on its algorithms.
After your exact match campaign is working well, clone it and change the match type for each keyword to phrase match. Because phrase match keywords include less qualified traffic, you're going to lower your maximum cost per click (Max. CPC) to aim for the same cost/conversion. We recommend bidding 80 percent of what you're bidding for the same keywords in exact match. ...