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The Good and Bad of Pay Per Click Advertising

By: Essmeier

Over the past decade, the Internet has revolutionized the way that people do business. While large corporations have a significant presence on the Internet, the nature of the Internet permits small businesses to compete on equal footing. Amazon may have a famous Website, but there is nothing to prevent Bob Smith from building a competing site called BobSmithsBooks.com. Thanks to the Internet, there is room for everyone to do business.

Having a presence on the Internet hardly guarantees success in business, however. In order to make sales, you have to have visitors come to your site. Drawing visitors, or "traffic", is perhaps the greatest problem that most Website owners face when putting their business onto the Internet. One can advertise a business using traditional offline methods, such as magazines or television, but most Website owners would rather try to draw the interest of customers that are already on the Internet. For drawing customers who are already on the Web, there may not be a better or faster method of obtaining traffic than pay per click advertising.

Pay per click, or PPC advertising, is an advertising system where businesses can purchase ad space with the major search engines. When someone does a search using Google, for instance, paid advertising appears right alongside the search results that Google provides. Businesses bid for prominent placement on these search results pages by bidding on the search keywords themselves. The companies pay the search engines each time a visitor clicks on the link in one of the ads. Depending on the search topic, the bids may range from as little as a few cents to as much as $100 per click.

There are several benefits to using pay per click advertising instead other media:

The advertiser chooses the price. Advertisers place bids on the price they are willing to pay for each search term or keyword. This allows companies with modest advertising budgets to still have their ads shown alongside the ads of businesses with deeper pockets.

Businesses can set daily, weekly, or monthly advertising budgets. If you can only afford one hundred dollars per month on advertisements, you can decide if the ads are to be shown all at once or spread out over the day, week or month. You can limit your spending to the amount of money that you can afford. The service is very quick. With Google's Adwords program, advertisers can compose their advertisement and have it displayed to customers in no more than five minutes. No other ad medium offers the chance to have ads shown to the public as quickly as pay per click.

The benefits of PPC advertising are obvious. You can frequently have visitors at your Website in a couple of minutes and you can choose how much you want to spend.

There are some potential problems with pay per click advertising, though:

The market is competitive. If you are placing bids on terms that are particularly competitive, you may find that you will need to pay many dollars per click when your advertising budget may only allow a few pennies. If fifty advertisers all outbid you, your ads may be displayed on a page where few people will see them. Prices vary widely among different search terms.

Not all search terms produce good results. You may find yourself bidding on terms that bring customers to your site but do not produce sales. Pay per click advertisers need to carefully watch the performance of their advertisements to ensure that the keywords they are bidding on generate both sales and traffic.

Anyone who is considering pay per click advertising should probably start with a modest daily budget and be prepared to take part in a lot of experimentation in order to find the ads and search terms that work best. While the pay per click advertising model is quite successful, it can also provide a good opportunity to spend a lot of money without much to show for it.

Article Source: http://www.articlewheel.com

Copyright 2008 by Retro Marketing. Charles Essmeier owns DoublingStocks-Review.net, a site that reviews the Doubling Stocks newsletter, and WorkingFromHome-Review.com, a site that reviews Ewen Chia's product called Working From Home.

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