In March 2004, we wrote an article on Internet Marketing, highlighting the types of programs you have available to build awareness and generate leads using the Internet. In this article, we will focus on Internet Advertising using a pay per click (PPC) service such as Overture and Google AdWords. It is now quite practical for many businesses to add this activity to their marketing plan and budget.
What is Pay Per Click?
A Pay Per Click (also known as Pay Per Ranking, Pay Per Placement or Pay Per Position) search engine enables you to list your site at the top of the search engine results. You don’t pay to list your advertisement; you pay only when a user clicks on your listing and connects to your site.
How your advertisements get displayed is based on two factors: what keywords from which you wish to be found and how much you are willing to bid to get a better ranking. If your keyword is very popular, you will pay more. If it is not, you can get clicks to your site for a few pennies.
To get the best traffic to your site, you need to select keywords that refer to your product or service. Your advertisement must, in very few words, convey a call to action for someone to click through. For each keyword you determine how much you are willing to spend. The higher you bid the higher you will appear in the search results.
What Does Overture Provide?
Overture provides cheap, targeted web site traffic. They have become one of the leading PPC search engines. You have many tools available to you to help with setting up your keywords, the advertisement, and your maximum bid. Your bid for rankings can go from 10 cents to $50 max. Since you can write the description and title you want for your advertisement, you can play with your campaign to determine which ads provide the most highly targeted traffic to your website. The best part of the Overture capability is that you can control your bids at all times and adjust them, based on the quality of your results.
What Does Google AdWords Provide?
Google’s self-service AdWords program charges a per click fee, similar to Overture. AdWords charges a $5 activation fee, and bids on keywords are from 5 cents to $100. However, there are other differences.
Where Overture ranks the advertisements in order by those who bid the most, AdWords are ranked for placement by a combination of cost per click (CPC) multiplied by the click through rate. Thus, even if two ads have the same CPC, the ad with the higher click through rate gets listed first. In other words, Google ranks ads based on its total value to Google.
Conversely, Google will penalize those ads that do not have a good click through rate. Really bad ads — those that get below 0.5 percent in clicks after appearing 1,000 times, will be prevented from appearing at all. The rationale for this is to increase the value of the PPC real estate on the page.
What Makes this Type of Advertising Affordable & Effective?
There are many benefits to using a PPC service for advertising your business.
- You pay only when someone actually visits your site.
- You can guarantee relevant placement of your advertisement.
- The results are highly quantifiable, particularly when you use sales conversion tracking.
- The process involves nearly zero risk. No $50,000 media buys. Not even $2,000 media buys. You pay one day at a time.
- Your listings appear only when a particular keyword is requested, thereby appearing only when a user is actively searching for your product or service.
- You can present a title and a description for your product or service that will give a lot more information, specific to their search query, than banner advertisements allow.
- You pay nothing for impressions (a term used to indicate when your advertisement appears), unlike banner ads where you pay a dollar amount for every 1000 impressions (similar to traditional media costs). For example, you will be charged $50 per 1000 impressions for a banner ad. Of those 1000 impressions, standard click-through rate is approximately 3%, about 1-2 people. If your search term is reasonably popular, chances are you would bid well under $50 per click (more likely $1- $2 for a more specific keyword) and still have your advertisement prominently displayed. Depending on your bid price, that same $50 would get you many more qualified visitors to your site than a banner ad would.
- The conversion rate (the number of people who buy from you that click through) for your PPC advertisement is higher than the click through rate of banner ads.
What Should You Do?
If you have a small budget and it is important for you to drive targeted traffic to your site, using a service like Overture or Google AdWords can have a great return on investment. The benefits are many, and you can control your costs and you can track and test your results to improve your click through rate. All of this can turn into more sales leads and more business for you.