This is actually very easy to do…

In this example, I will use the keyword phrase "fishing gear" (you can use your primary keyword or just follow along for now).

Go to Google.com and do a search for "fishing gear". Then click More Sponsored Links ». Print all the pages, so you can review the ads.

Now do a Sponsored Links search for "free fishing gear" and print all the pages. Look for all the ads that are no longer displayed…

These advertisers are most likely using the negative keyword "free". Most beginners don't do this. These are the advertisers to watch.

I suggest you visit each of their websites and see what they are selling. If they offer an ecourse or newsletter, then sign up. You will also want to track their ads and ad positions on Google a minimum of once per week for a month or so.

Next do a Sponsored Links search for "free fishing abcdef" (you can use any random string of characters). Print all the pages. Ignore these advertisers. They are totally clueless and are simply wasting money.

All of the other advertisers are your real competition. Model your AdWords ads after theirs for maximum results. You will be very pleased with the results.

Lastly, rinse and repeat. Do this for all of your keywords.

I do suggest using a keyword tool to expand your keyword list and automate the process.

You might also want to check out Adwatchers.com. This tool finds profitable AdWords, Yahoo, and MSN PPC campaigns.