Is Your Business Ready For "Pay-Per-Click" Advertising?
It has been hard to miss all the news about Google in the last few days, and how they are poised, one might believe, to storm Madison Avenue for their next act. That remains to be seen, but the main point is that Google is currently showing record profits based on its ever-expanding “pay-per-click” (PPC) advertising model. Why are so many businesses turning to this form of advertising, specifically, to Google Adwords? Before you join the herd, here are some things to consider.
What Is Pay-Per-Click Advertising (PPC)?
PPC advertising, such as Adwords from Google, or Yahoo! Search Marketing, is an auction-based advertising model. You create a small ad, usually text (although that is beginning to change) and you bid how much you would pay for a user to click through from the ad to your website. The ads run on major search engines and across the internet, and are triggered when users search with certain keywords on which advertisers have bid. The beauty of PPC is that you only pay when a user visits your site. (Unlike most old advertising models, where you paid for impressions, or visibility). If you only pay when a user clicks, you can, in various ways, track the effectiveness of your ads with greater accuracy than ever before.
Are Customers Looking For You Online?
This is a key question. If you have the kind of business that used to succeed with Yellow Pages advertising, then you may well be a good candidate for PPC. Example: if you are a plumber, you will probably do well in this environment. When people need a plumber, they turn to vehicles like the Yellow Pages, or, increasingly, online. But Yellow Pages type businesses are not the only good candidates for PPC. You might have a business that sells hard-to-find items. This also can be a good candidate for online advertising. The key thing to know is that tools exist which will allow you, or your online marketing consultant, to measure the level of online interest in your particular field.
Is Your Price Point High Enough?
Depending on your industry, the cost of PPC can range from reasonable to outrageous. Your “return-on-investment” (ROI) depends on whether your price point gives you a profit after you pay for your ads. Example: imagine you sell blue widgets at $20 a piece. Let’s say your “cost-per-click” to advertise your blue widgets via PPC is $1. And let’s assume out of every 100 clicks to your site, you sell one widget (a 1% conversion rate). You’ve just spent $100 to make a $20 sale. However, if you sell blue widgets at $500 each, then maybe your 1% conversion rate makes it profitable. Again, this is all something you can test and tweak, using a PPC model.
How Do You Get Started With PPC?
The two big PPC vendors are Google and Yahoo! Both services are supposed to be “self-service.” If you want to spend a whole lot of time trying to make them work for you, then you can do it yourself. If your time and resources are valuable, you are probably better off working with an internet marketing company that will manage your campaign for you. The best way to find out if PPC will work for your business is to talk to a knowledgeable consultant who can evaluate your situation. It will be cheaper to go that route, than spending a whole lot of money on advertising that does not work for you.
What Is Pay-Per-Click Advertising (PPC)?
PPC advertising, such as Adwords from Google, or Yahoo! Search Marketing, is an auction-based advertising model. You create a small ad, usually text (although that is beginning to change) and you bid how much you would pay for a user to click through from the ad to your website. The ads run on major search engines and across the internet, and are triggered when users search with certain keywords on which advertisers have bid. The beauty of PPC is that you only pay when a user visits your site. (Unlike most old advertising models, where you paid for impressions, or visibility). If you only pay when a user clicks, you can, in various ways, track the effectiveness of your ads with greater accuracy than ever before.
Are Customers Looking For You Online?
This is a key question. If you have the kind of business that used to succeed with Yellow Pages advertising, then you may well be a good candidate for PPC. Example: if you are a plumber, you will probably do well in this environment. When people need a plumber, they turn to vehicles like the Yellow Pages, or, increasingly, online. But Yellow Pages type businesses are not the only good candidates for PPC. You might have a business that sells hard-to-find items. This also can be a good candidate for online advertising. The key thing to know is that tools exist which will allow you, or your online marketing consultant, to measure the level of online interest in your particular field.
Is Your Price Point High Enough?
Depending on your industry, the cost of PPC can range from reasonable to outrageous. Your “return-on-investment” (ROI) depends on whether your price point gives you a profit after you pay for your ads. Example: imagine you sell blue widgets at $20 a piece. Let’s say your “cost-per-click” to advertise your blue widgets via PPC is $1. And let’s assume out of every 100 clicks to your site, you sell one widget (a 1% conversion rate). You’ve just spent $100 to make a $20 sale. However, if you sell blue widgets at $500 each, then maybe your 1% conversion rate makes it profitable. Again, this is all something you can test and tweak, using a PPC model.
How Do You Get Started With PPC?
The two big PPC vendors are Google and Yahoo! Both services are supposed to be “self-service.” If you want to spend a whole lot of time trying to make them work for you, then you can do it yourself. If your time and resources are valuable, you are probably better off working with an internet marketing company that will manage your campaign for you. The best way to find out if PPC will work for your business is to talk to a knowledgeable consultant who can evaluate your situation. It will be cheaper to go that route, than spending a whole lot of money on advertising that does not work for you.
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