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Pay-per-click Advertising - The Basics
By Halstatt Pires, Sat Dec 10th

Search engine optimization can take a long time to show results.The Google sandbox alone can delay optimization results by 6 to8 months. So, what can you do to get traffic while you wait?Pay-per-click [“PPC”] campaigns fill the time gap. This articlediscusses the basics of advertising.

What Is A PPC?

A search engine allows you to bid for placement in searchresults. Search engines such as Google, Yahoo, MSN, AOL and mostothers bolster their organic search results with sponsoradvertisements. If you search on Google, links in blue acrossthe top and the little ads down the right side of the searchresults are listings. In one form or another, similarlistings appear on every major search engine.

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How Does It Work?

When you use a PPC, you will bid for placement in the searchresults under particular keywords. Instead of optimizing yoursite to appear high in the listings, you simple pay for theposition. While this may sound great, keep in mind you arepaying for the listing and have to watch the return oninvestment closely.

To get started, you must open an account with the inquestion. The two biggest PPCs are Google Adwords and Overture.You will need to register with the PPC, provide a credit cardnumber and, depending on the PPC, deposit money into theaccount. Next, create ads with a title, body text and link tothe landing page of your site. The title of each ad shouldcorrespond to a particular keyword you want to promote. If atall possible, include the keyword in the actual title. Finally,you will be asked to bid on placement in the search results.

Bidding for placement is not as simple as it my sound. Ideally,your ad should be in the top 3, but never below the 10thposition. This has to be balanced, however, by the return oninvestment of the campaign. If you sell a product that producesa $10 dollar profit per sale, you probably can’t afford to pay$.90 per click. If your site converts 1 visitor out of every 100into a sale, you will spend $90 for every sale. Obviously, thatis going to work out very well. The one caveat to this situationis a business with reoccurring revenue.

If you site charges clients a reoccurring monthly fee, you canbid in excess of your immediate profit margin. To do thissafely, you must determine how long the average customer willstay on your site. For example, if you make a $10 profit permonth and the average customer pays for 5 months, the totalprofit is $50. In this situation, you can spend $20 or $30 toobtain a customer and still turn a profit.

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To properly manage aPPC campaign for a reoccurring charge site, you must recalculatethe profit per customer ever week to protect yourself.

PPC Cons

Why not just use a campaign instead of pursuing searchengine optimization? There are a number of reasons. First, youare paying for each click with a PPC, which requires a budgetand may impact your cash flow. Second, bidding iscompetitive and that translates into higher costs, so much sothat a profit may be hard to make. Third, many people simply donot click on ads with the figure being as high as 20percent. Fourth, you run the risk of having people click on yourads with no intention of buying, whether they are just browsingor are trying to exhaust your advertising budget.

PPCs definitely have a place in the online marketing field.Manage your campaigns with an eye for detail and you shouldfine.

About the author:Halstatt Pires is with MarketingTitan- an Internet marketing and advertisingcompany in San Diego, California comprised of a search engineoptimization specialist providing meta tag optimization servicesand Internet marketing consultant providing internet marketingsolutions through integrated design and programming services.

 

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