Pay-Per-Click Advertising

When you enter terms in a search engine you are presented with two types of results: organic listings and sponsored links. Some of these, the organic listings, appear because Google believes those websites to have the content you are looking for. Other listings, the sponsored links, appear because the advertiser has offered to pay the search engine when their ad is clicked.


Figure 1 - Organic and Sponsored Results

The above figure shows that www.mrsolar.com and www.wholesalesolar.com (in the organic section) have the best website content for the search terms "home solar system." SolarEnergy.org, BizRate.com, and TheSolarCenter.com (in the sponsored sections) have bid the highest for these pay-per-click ads, probably between $1.00 and $1.50. Pay-per-click ads are available through Google, Yahoo, MSN and hundreds of other services.

These pay-per-click ads appear not only on search engine results, but also on other solar power related web pages and even inside personal emails sent through Google's gmail system, or Yahoo's mail and group system, that mention solar power.

Buying Pay-Per-Click Advertising
Pay-per-click advertising is set up through the "Advertise With Us" link on most search engines. The basic concepts you'll need to be prepared for are:

Campaign: Choose a name for your advertising campaign.
Daily Budget: What is the maximum you are willing to spend per day?
Geo-Targeting: Do you want you ads to appear only in certain geographic areas?
Content Match: Do you want your ads to appear on other websites and inside personal emails, or just on search engine results?
Keywords: What keywords and phrases would you like to bid on?
Advanced Keyword Features: Negative keywords refer to words to exclude. For example a PV installer does not want the ad to appear if the search contains the word "Thermal." For the keyword phrase "home solar system", exact match will only display your ad if it has only those three words in that order.
Conversion Tracking: By adding a bit of code to webpages the search engine can report where, on your website, the customer goes.
Your Ad: You will then write your ad. The text and title of your ad is the most important aspect of your advertising campaign.

You will then be able to bid on the keyword and be given an indication of where your ad will appear. Tracking reports show activity almost immediately.

Pay-Per-Click Strategies
Creating a pay-per-click advertising program is easy. Managing an effective program however, can take years to master. The campaign needs to be set up such that prospective customers and only prospective customers click on your ad. If you're selling home solar PV systems in San Diego then you can't afford to pay for clicks from people looking for commercial systems, solar hot water systems, or PV systems outside your area.

Conversion tracking is one of the most important tools, but can be difficult to do well. It requires that you set up "goals' for people who come to your site. Common goals include clicking a "Buy Now" button, entering their email on a "Contact Us," or "Newsletter" page, or downloading a white paper or "site evaluation" worksheet. When a person reaches this goal then the click is deemed to be a conversion.

The number of people who go to site and become customers is the only way to measure the effectiveness of a pay-per-click campaign.

Ad Rotation is another way to test the effectiveness of your ad copy. For example, ad #1 might say: "... learn everything you need to know about home solar systems..."; ad #2 might say: "...learn everything you need to know to buy a home solar system..."

Each ad will display in turn. It is likely that you would see that ad #1 is clicked on more often because everyone wants to learn about solar. Ad #2, though, would likely result in more conversions because you are suggesting that this is a site for people who are interested in actually buying a system.

The Landing Page refers to the page on your website that the ad links to. It is critical that the landing page provide the information that pay-per-click ad promised. Otherwise, the potential customer will click his 'back' button and go someplace else, wasting your money.

While the ad is running, bid price, placement, clicks, conversions and more are all analyzed carefully to determine whether the campaigns, and each of the keywords, are effective. Keyword inventories, showing what keywords are being searched for and competitive analysis, identifying the keywords that other people are bidding on are all monitored.

Pay-Per-Click Pitfalls
A recent CNet News article reported that nearly 15% of all clicks are fraudulent. Click fraud often happens when search engine place their pay-per-click ads on related websites. For example, on several of my pages at TheEnergyGrid.com, I allow Google to place pay-per-click ads.

If you go to http://www.TheInternetIsThinkingAboutYou.com and click on one of the ads there, Google will bill that pay-per-click advertiser and share the revenue with me. In theory, I could write a program that clicks these ads all day long and make thousands of dollars, each click looking like it comes from a different computer. To that end, Google has hired people much smarter than I to detect and prevent this.

The Pay-Per-Click Challenge
So what would it mean to your business to suddenly have a flow of targeted, ready-to-buy customers to your website? This is the tantalizing promise of pay-per-click that can be accomplished with careful planning and a serious commitment to follow up. There are some advantages and some disadvantages to being at the top of the list? What you say, and where you say it make a huge difference in terms of click-through and conversions.

The most important aspect of effective pay-per-click advertising, however is the most basic: know how to use the reports and pay close attention to all aspects of your campaign.

Mark C. Robinson, of TheEnergyGrid.com, provides web marketing support for the renewable energy industry including website design, web hosting, search engine optimization, and pay-per-click campaign management.