What’s the big deal with Paid Search Marketing?

 There are still several different ways to pay for traffic to your site, including banners (yes, they still exist), but the most popular form has become contextual text ads, which are relevant to the search term or page content. These ads are priced on a Pay-Per-Click basis (PPC) rather than the number of times your ad is displayed (impressions).

 Many different companies offer text and graphical advertising, but the largest are currently Google AdWords, followed by Yahoo Search Marketing and then MSN’s adCentre.

The basic premise is that advertisers bid on keywords they predict their target market will use as search terms when they are looking for their product or service. When a user types a keyword query matching the advertiser’s keyword list, or views a page with relevant content, the advertiser’s ad may be shown. These ads are called a “Sponsored link” or “sponsored ads” and appear next to or above the “natural” or organic results on search engine results pages (SERPS), or anywhere a webmaster/blogger chooses to place them on a content page.

When we talk about Paid Search Management, or optimization for PPC, we are referring to one, or all of these processes:

  • Researching the costs and click-through-rates of relevant and descriptive keywords
  • Create compelling ads which produce a strong click-through-rate (CTR). This can involve testing and tracking several different ads. (A-B Testing)
  • Creating and fine-tuning the landing page(s) (the page(s) the surfer reaches after clicking on the ad) to encourage the visitor to take the desired action (buy product, download file, etc.) This is referred to as “The Call To Action”, and is measured in terms such as “conversion” and “return on investment (ROI).
  • Measurement and Tracking, which I will explain in Lesson 3, is critical to measure the effectiveness of PPC campaigns, from the CTR, through to Conversion. 

So, who are the players?

Google is the largest provider of paid ads and sells sponsored listings that appear above and to the right-hand side of its regular search results; these listings are called Google AdWords.

Google AdWords ranks sponsored listings based on a number of variables including the CPC (bid price), click-through-rate (CTR), website content, the user’s geographical location, and other factors. It is not a simple “pay-for-position” service.

Examples: Surfers in Canada and the USA may see different ads, or the same ads ordered differently because of what is called “geo-targeting”. Another example would be Sites A bidding more than Site B for the same keyword, but site B is listed first, ahead of Site A. Why? Well, it could be several factors, but the most common is if Site B’s ad has a higher Click-Through- Rate (CTR), Google will consider that ad more relevant for that particular keyword and display it higher than Site A’s.

If your goal is to build visibility on search engines quickly, then Google AdWords is an essential option to explore. Depending on your key words or phrases, and your budget, you can be in the top results very quickly.

Yahoo Search Marketing(YSM), formerly Overture and GoTo, also allows sites to “bid” on the terms they wish to appear for. Up until recent improvements were implemented in 2007, YSM ranked sponsored listings based solely on the bid amount, which made for nothing more than an auction for placement.

Recent changes however, brings YSM’s ranking algorithm for paid ads more in line with that of Google’s by considering additional variables such as click-through-rate, and the quality of the landing page.

I personally find that Yahoo is less competitive for certain keywords and therefore the top and average bid amounts may be lower than on Google, while still providing as many, if not more, impressions.

Microsoft adCenter

launched in May 2006, and much like the Google and Yahoo services, allows advertisers to “bid” on the keywords they wish to have their ads show up for. The system uses a similar approach to the way Google, and now Yahoo, determine the CPC value. 
 The CPC is a combination of how much you are willing to bid (max bid) and your Click Thru Rate (CTR) in comparison to the others bidding for that particular keyword. This also determines how frequently your advertisement is shown.
AdCenter distinguished itself from its competitors by being the first to offer geographic and more importantly demographic targeting. It requires a $5 service fee for account setup. After that, you pay the cost of the clicks.
To sum up… if you need quick traffic results, and have at least a small budget, PPC Advertising will bring almost immediate results, provided that: a) you select the right keywords b) bid the right amount, and c) have creative and compelling ads and landing pages.

I always recommend combining Organic SEO strategies with a PPC campaign for both short-term and longer-term traffic development.

 Unfortunately YSM continues to only allow US Webmasters to generate revenue from their ad feeds. I mainly target Canadian traffic, but no Canadian-owned site can carry the Yahoo Ad Feed L

Next posting I will discuss the importance of Web Analytics… “How” and “What” you should be tracking.