Internet Marketing &
Business Promotion
Managing a Responsible Pay-Per-Click
Campaign
by Scott Buresh
Overview
What is Pay-Per-Click?
Pay-Per-Click (PPC) is a paid form of advertising, popularized
mostly by the "search engine" GoTo (now called
Overture). The concept is fairly simple. Businesses
bid to be placed at or near the top of the search results
for particular keyword phrases. The bidding is done
on a "per-click" basis, meaning that a company
pays a specific amount every time the engine sends them
a visitor. In addition, the top results on Overture
also show up in the results of many of the popular search
engines (usually listed as "sponsored" or
"featured" results). Google has also recently
come up with a similar version of PPC (AdWords Select)
that has taken over some of the engines that used to
display Overture results (most notably AOL Search).
Advantages
Pay-Per-Click campaigns have some advantages over traditional
search engine optimization. First of all, they require
no changes to a current site's content or look to obtain
top positions, just a willingness to pay. Also, the
implementation of a pay-per-click campaign is relatively
quick- it can take just a few minutes to start getting
targeted traffic, versus sometimes months for standard
SEO campaigns. Finally, unlike search engine optimization,
the implementation of a PPC campaign is relatively easy
and does not necessarily require any specialized knowledge
(although experience with search engine marketing and
keyword research is a definite advantage).
Limitations
Of course, there are limitations to this type of advertising.
New bids can lower the positions of other firms, and
many will react by raising their bid to regain a previous
ranking. Monitoring of positions becomes crucial. These
campaigns can also become prohibitively expensive, depending
on the competitiveness of the keyword phrases and the
aggressiveness of the competition. In addition, many
of the "savvier" search engine users have
learned to recognize PPC results as paid advertising
and bypass them without consideration.
The Process
Determining Visitor Worth
Determining how much each website visitor is worth is
vital to the success of a pay-per-click campaign. If
it costs $50 in click-throughs to make a $40 sale, the
campaign has failed. The formula is relatively simple,
but some specific historical data is necessary. In the
most rudimentary form, it is the profit from the website
over a given period divided by the number of total visitors
for the same period. If a site netted $1000 in profits
from goods or services in a given period, and there
were 2,000 visitors during the same period, each would
theoretically be worth 50 cents (profit divided by visitors).
But this is only the breakeven point. Depending on the
desired profit margin, the optimal price to pay per
click would probably be something much less than 50
cents. Popular keyword phrases can often run more than
this, so it then makes sense to bid less money on less
popular terms to pay an acceptable amount per visitor.
Selecting Keyphrases:
As with typical search engine optimization, keyword
research is critical to the success of a PPC campaign.
Unlike typical search engine optimization, there aren't
practical limits on the number of phrases to target.
Usually, there is no extra cost to add as many keyword
phrases as possible. This makes the keyword selection
process easier, since there is not a good deal of resources
committed to optimizing a site for a particular keyword
set. Under-performing keywords, while still an annoyance,
do not cost extra (except for the time involved in setting
up the account). To help identify keyword phrases, Overture
has a tool on their site that allows advertisers to
see how often particular search terms are actually typed
in their engine. It also gives out popular suggestions
based upon the terms you enter.
Writing descriptions:
With a typical search engine description, the object
is to entice as much traffic into a site as possible
in the hopes of converting that traffic into customers.
With PPC, a different approach is mandated. It is undesirable
to pay for unlikely prospects, so the description is
designed to eliminate the "tire kickers" while
attracting highly targeted traffic. For this reason,
the description should describe exactly what the business
offers- a company wouldn't want to pay for every visitor
looking for "insurance" if they only sold
renter's insurance, for example. At the same time, proven
marketing copy techniques should be employed to insure
that the description is enticing enough to attract ideal
prospects.
Monitoring and Analyzing:
It is crucial to the success of any PPC campaign that
it be monitored regularly, since positions can and do
change every day. Since the top three Overture or Google
AdWords results are what typically show up on most partner
engines (some display more), the competition for these
spots can be fierce, and bidding wars are common. If
the price gets too high, it is usually prudent to withdraw
and pursue a different keyword (the only way to really
"lose" a bidding war is to pay too much for
each visitor!). Apart from position monitoring, it is
important to track and analyze the effectiveness of
individual keyword phrases on a monthly basis. Viewing
click-through rates and studying visitor habits can
lend valuable insight into their motivations and habits,
and help to further refine a Pay-Per-Click campaign.
Conclusion
Pay Per Click campaigns can bring large numbers of
highly targeted visitors to your website. However, these
campaigns can become prohibitively expensive (and unlike
"traditional" search engine optimization,
the costs of any PPC campaign are likely to increase
in the near future due to the increased popularity of
this form of advertising). It is crucial to the success
of the campaign that you pay a reasonable price for
each visitor, that each visitor is highly targeted,
and that you monitor your positions to maintain your
exposure over time.
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About the Author
Scott Buresh is Co-founder and Principal of Medium
Blue Internet Marketing .
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