Choose a Target Advertising Cost of Spend (ACoS) percentage. This is the amount of ad spend vs the number of sales you make. So if you set your ACoS at 20% and make $100, your ad spend will be $20 and your profit will be $80.
Run an automatic campaign for about 30 days to collect data on keywords. When the 30 days is up, you should have a good understanding of what keywords worked and which didn’t work. Feel free to check earlier than 30 days, but this is a good time frame to get the most understanding and to see trends.
Take your highest-converting keywords and stick them into a manual campaign and increase the bids for them. You can inch up these bids later (I’ll get to that in a second).
Regarding bidding, if you bid aggressively your ACoS will go really high and reduce profit, but if you bid conservatively and inch up your bids as you go, your ACoS will be low. So, mainly you want to bid the least possible to get the most information possible. That means on day one of bidding, try bidding 10 cents because you don’t know how a keyword will perform. You will probably see no clicks. The next day, bid 10 more cents, then 10 more cents, etc., until you see some conversions. You will get the same amount of sales, except you didn’t just take some expensive shots in the dark. More on this in my video: https://youtu.be/HbU5ByiuVfE