Should I enter only effective keywords into AdWords?

Question

Keyword research tools like Keyword Planner seem to fulfill two basic functions:

1. Generate a list of possible keywords
2. Provide estimates (CPC, traffic, ...) to whittle down this list to the most effective keywords

Do I need the second step? Is there any downside in uploading a huge list with thousands of keywords and just wait and see how they perform? It's pay per click so I'm not losing money on low performing keywords.

Ultimately I'm only interested in conversions and that's a metric that can't be estimated by the tools anyway.

Edit:

As Joshak points out, I need to remove all obviously non-converting keywords. What about other keywords that could theoretically convert but the estimates show it's unlikely. For example 0 traffic or very high cpc, so it's unlikely I will win the bid. It would be more work to remove them and there are slight changes that they bring conversions. Is there any downside in using them?

Answer 1

Generally the step 1 you refer to generates a lot of keywords that are marginally relevant or keywords that have no chance of converting, these keywords will still likely drive clicks so step 2 helps you save some (or a lot) of money when you begin your campaigns. It doesn't take long to weed out those keywords that are obviously not helpful as well as gather ideas for negative keywords that will help your campaigns perform to the fullest.

In short, even after you whittle down the list there will still be more keywords to weed out once you get real data, but I wouldn't just load the list from step 1 unless you have money to burn.

Answer 2

To get better results one should keep entering the +ve keywords and should keep on removing the -ve keywords.