How do I get started in SEM with no actual experience in it? I want to do some Lead Gen for other businesses.

We have an overlapping but non-competing interest in this area. What I'd recommend is ... skip the books or guides on Google AdWords or the Bing equivalent. You've already read enough, and your question is framed with enough specific detail that you're obviously no slouch and probably past the beginner stage, I'd say. Reading guides would provide steadily diminishing returns. DIY time! Brainstorm keyword ideas. Research the search stats. Once you feel you've covered all the relevant search queries and prioritized them, then it's time to run experiments. That's why I say skip the books. At a certain stage, you have to leave biology textbooks behind and go dissect some frogs or observe the live frogs (your customers?) in nature. Nothing is more empirical than running an efficient SEM campaign. You know this. Rules are starting points to b left behind in this space. Books and guides might provide some preliminary tips (at best) or be authoritarian (at worst). Just arrange your spending alternatives as hypotheses. Measure which strategy performs better using some carefully planned A/B testing over a statistically significant period of time / impressions / clicks. Set aside the generalizations. No author will give you what you need because you're already thinking of your problem at a granular level of detail. Brainstorm. Plan tests. Measure. Rinse & repeat. If you want to put 2 heads together, I might be able to throw out some extra ideas. But you don't necessarily need another person.

First of all, finding keywords that are relevant to your products or services is the first step in an SEO effort. If the words are not under high demand for advertisements, the keywords can be more cost effective as long as there is still sufficient search volume. In other words, you want to make sure they keywords are something people use. The next step is a solid content strategy to employ the keywords in a natural way. I find the SEO Table at search engine land to be the best guide. You can find it at http://searchengineland.com/seotable. The key is to use the good practices, such as incorporating words in your articles and posts as well as URLs, and capitalizing on external sources, such as Social Media. At the same time, you artificially loading up on keyboards.

A few thoughts... First, there is a 20k adgroup limit per campaign. Second, going in you should assume that 80% of your long tail keywords will not get any impressions. That being said, this is a common strategy with several different ways to execute on it... 1. The rule of thumb when building out campaigns is being mindful of how you will optimize and manage it. I like to ask myself...Will my ad copy or settings change if I separate these keywords into new adgtoups? If not, group them together(unless you can't on the build out). 2. Become intimately familiar with filters, segments, columns, labels, and dimensions or else managing it can become impossible. 3. There are two common strategies that people use similar to this... One is putting all matchtypes in 3 dif. Adgroups and negated out the other matchtypes... The other strategy is starting a beta campaign with only broad modifier and when you find converting queries in your search term report you move this over to an alpha campaign with higher bids. Putting both together in the same ad group would be pointless. As for the effectiveness of using any of these strategies it would really depend on the effort involved in building out and managing it and on how crucial it is you don't miss out on any queries... I would be happy to explore your specific situation if you call me.

Let's take the example of a single keyword, which we aren't sure how it'll perform. We'll need to make a few more assumptions to get started. Hopefully, you can produce these based on similar activity in the account, or on your site. You'll need an Average Order Value assumption first. If you're targeting a specific product, that product's price is a reasonable place to start. We'll assume $150. You'll also need a Conversion Rate. You can either use data from a similar campaign, or your site's average. Don't worry--it can be a ballpark, as this will correct course quickly enough. We'll assume 3%. You'll need to know how much you're willing to pay for advertising, as a percent of revenue. Too high, and your margin erodes. Too low, and you give up market share. This figure is called your Cost Of Sale (COS), and is just the reciprocal of your ROI target. Let's assume you're looking to spend no more than 15% of revenue for these ads. Now, with the COS and the AOV, you can arrive at a Cost Per Acquisition (CPA) target. This is how many dollars you can spend per conversion. In our case, it's $150 * 15% = $22.50. That's how much we can spend to generate the clicks it takes to produce a conversion. If we have the Conversion Rate, then we know how many clicks (on average) that takes. At 3% conversion rate, we average an order for every ~33 clicks, so the $22.50 is all we can pay for them and still hit our goal. That's $0.68 per click, and that makes for a GREAT starting point. But how do you know when to give up? You can use Wolfram|Alpha to find out how many clicks it would take to get to 95% probability of a conversion: http://www.wolframalpha.com/input/?i=%281+-+.03%29%5Ex+%3D+%281+-+.95%29 The .03 is our conversion rate, and the .95 is the certainty we'd like to hit. This solves to ~98 clicks, so we'll run our test to at least that many. If you get a conversion sooner than that (with some sort of upper bound), you can bid based on the real conversion rate. For example, if you got a conversion after 25 clicks, you can bid using that 4% number. If that's actually too high, you'll have collected the additional clicks to know that fairly quickly, so it turns itself back down before it spends very much. If you aren't getting a conversion, you can also bid as if you had only one. If you are at 90 clicks, for example, and still haven't seen a conversion, you could bid as if you had one, bid using the 1.11% rate, and your bid will be cautious, skeptical even, and your spend will be controlled. Now, this was all for a single biddable entity, perhaps a keyword. What I'd recommend is to keep your long-tail keywords separate from your higher-action keywords, in different AdGroups. As you sift out higher-performers, move them to the main group. Slower-action keywords can stay in the long-tail. You may not even need to bid at the keyword level, if you use this strategy, as you can apply exactly the same logic to the AdGroup level. If the entire Group is a new test, then this will accumulate clicks more rapidly, and reduce costs. Now, how ever broad you go will set how much risk you're taking on. If you have one keyword, like this example, you're probably only going to spend about $50. If you do that thousands of times, then that number goes up with it. If you'd like to talk through this, I'd be happy to do so. My VIP link is: https://clarity.fm/roysteves/statbid

Technically you can bid on competitors. Take for example Autotrader who bids for keywords such as Honda, Ford, etc. But the best advice is actually here http://searchengineland.com/the-complete-guide-to-bidding-on-competitor-brand-names-trademarked-terms-118576