The Google message is simply a product of a calculation that is pointing out the potential traffic you are missing out on by not spending more. It is mathematically precise, i assure you.
Of course, you have to make the judgement as to whether or not you DO spend more, or whether to adopt other strategies to get more traffic, or different traffic to your website.
Ad words is a powerful tool. It is not, however, a guaruntee of business! However, I do agree that it favours larger budgets than this. It is a very big pond, the internet, and tricky to be at the top of it...
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