Guide to Internet Marketing - Pay Per Click

It is one thing to have an effective website, but if nobody knows about or clicks on to your site, how effective is it really? As the old adage goes: If a tree falls in the middle of the jungle, where there is nobody for miles around, does it really make a sound.

Online advertising has evolved into numerous creative ways in which a company can make its presence known on the web. One of the most popular methods used today is called Pay per Click (PPC) advertising. It is most commonly used on websites, advertising networks and search engines. The way in which PPC ads usually work is by placing a text ad near to a search result. The reasoning goes that advertisers do not actually pay for placement. Technically, the positions or listings are free. You pay only for each click (i.e. visitor) that you receive from that search engine listing. When the site visitor clicks on the advertisement, the advertiser is charged a set fee. This fee can range from anything between £0.01 and £15 per click or more, depending on the popularity of the search term and the search engine being used.

The advantage that PPC holds over other online advertising methods is that you only pay for the actual click-through to you site. In general, there are no guarantees to how much one might end up paying per visitor acquired through most other forms of advertising. TV, radio, print, and others normally force you, the advertiser, to bear all the cost, regardless of the effectiveness of the campaign.

Even though PPC does not guarantee making a profit, it does significantly decrease the risk involved compared to many other forms of advertising. It is a common fact that visitors clicking on to your site through search engines are much more likely to purchase products or services, as these visitors, in theory, are actively looking for what you have to offer.

There are three main categories of PPC advertising engines, namely keyword, product and service engines, but more models are constantly being developed.

Keyword PPC’s:

Advertisers using these engines bid on keywords or phrases. When a user does a search on a particular word or phrase, the list of advertiser links appear in order of the highest bidder. Keywords and phrases are considered to be at the very heart of PPC advertising, and these terms are guarded as highly valuable trade secrets. An industry of professionals that can assist advertisers in marketing their products and services on search engines has also developed and many firms offer software or services to help advertisers develop these invaluable words.

Product PPC’s:

Product engines let advertisers provide feeds of their product databases. When users search for a product, the links to the different advertisers for that particular product appear, giving more prominence to advertisers who pay more, but letting the user sort by price to see the lowest priced product and then click on it to buy. These engines are also called Product comparison engines or Price comparison engines.

Service PPC’s:

Very similar to Product PPC’s, service engines let advertisers provide feeds of their service databases. When users search for a service links to advertisers for that particular service appear, giving prominence to advertisers who pay more, but letting users sort their results by price or other methods. Some Product PPC’s have expanded into the service space while other service engines operate in more specific fields.

Although PPC may initially seem like a very easy method of increasing awareness of your product on the web, making the most of this method can be a complicated and time-consuming process. Some pitfalls which you should take care to avoid when implementing your PPC campaign include:

* Targeting very general keywords: For a business offering a localised or specialised service, offering target keywords which are too general may lead to a proportion of clicks from visitors who are unlikely to make a purchase, effectively raising the cost of your campaign.

* Not targeting a wide enough range of keywords: Many advertisers simply target a small range of the most obvious words, and as a result there is much less competition for more specific or less obvious terms, resulting in lower costs. These less obvious keywords are often searched for by users who have refined their search, and will therefore be more likely to make a purchase.

* Bidding more than is cost effective: In some markets there is a great deal of competition to be ranked as highly as possible for the most obvious keywords, which can result in a bidding war and advertisers moving past what is cost effective for them. Always keep your campaign in perspective and consider what other advertising options you might have, as well as their effectiveness with relation to the product you are marketing.

* Not considering the target website: All too often a large percentage of the budget is invested in the advertising campaign, whilst little thought is given to the process and decisions the client will have to go through once they reach your website. Making a client’s journey simple, establishing your product’s credibility and effectively providing key information can all help turn a visit into a sale.

An obvious question on everybody’s mind is what happens when competitors keep clicking on your adverts in order to drive up the costs of your campaign. This practice has been coined ‘click fraud’, and is a serious issue that the main PPC providers are keen to combat. The use of computers to commit this type of fraud is a felony in many jurisdictions, and in the past there have been arrests relating to click fraud with regard to malicious clicking in order to deplete a competitor's advertising budget. Proving click fraud can be very difficult, since it is hard to know who is behind a computer and what their intentions are. Often the best an advertising network can do is to identify which clicks are most likely fraudulent and not charge the account of the advertiser.

In today’s market most businesses use the web as a way to get their product known to the world, but because of its popularity, advertising on the internet has become more competitive and as a result new strategies have had to be adopted. PPC is one of these strategies, and its popularity in current advertising campaings speaks for its effectiveness. The main benefits of PPC advertising are:

* It is immediate or very fast to implement.

* It is measurable.

* It is cost effective.

* It is for businesses of all sizes.

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