A previous article, Pay-per-Click Advertising, discussed how a renewable energy company could put the web ‘on commission,’ paying only when your ad is clicked on. It’s a popular model, but riddled with potential fraud and waste. For example, the Pay-per-Click ad shown below is going to be clicked by everyone interested in renewable energy (and who isn’t these days?) and spend money attracting people to the site who are not potential customers.
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The fraud potential in the Pay-per-Click model is huge. ‘Click Fraud’ involves clicking on a Pay-per-Click for personal gain or competitive advantage. For example, if Company A bids $1.00 on a Pay-per-Click ad with a $20 daily budget and their competitor, Company B, gets up every morning and clicks 20 times on Company A’s ad, then the daily budget of Company A is exhausted and its ad will no longer appear.
In addition, if I subscribe to Google’s Adsense program then I allow Google to place relevant Pay-per-Click ads on my website and share the revenue. If I go to my website every day and click on all the ads, these are fraudulent clicks. Of course, these examples are somewhat oversimplified as search engines have software in place to detect this.
Pay-Per-Click waste and fraud can be avoided with effective campaign monitoring. If you are paying, for example, $20 a day for $1,000 in sales then click-fraud is irrelevant.
An alternative, or complementary, strategy puts the web ‘on salary’ and can dramatically improve your results. In some cases, Pay-per-View advertising can be the most effective and economical way to reach your target audience.
The primary difference between Pay-per-Click and Pay-per-View is whether you or the advertising provider decides where your ads are placed.
In the Pay-per-Click model, the search engines decide. They place your ads on search result pages and, optionally, on other pages throughout the web. When they bring you a customer, you are billed. The search engines have a financial incentive to place your ads only where they are most likely to be clicked on.
If a Pay-per-Click ad were to cost $1 per click, the same Pay-per-View ad might costs $0.05 to $0.10 per view. The difference is that you decide where the ad is placed and pay whenever the ad is seen, rather than when it is clicked.
For example, this newsletter is being read by businesspeople in the renewable energy industry. When an ad like this appears here…
… then there is no doubt that it is reaching its intended audience. It doesn’t matter whether the ad is clicked on or not because it is valuable simply because it is seen.
Pay-per-View advertising appears on websites and in newsletters. Like Pay-per-Click advertising, Pay-per-View ads generate ‘click-through’ statistics that show what percentage of people who saw the ad and clicked on it. When considering Pay-per-View advertising, there are some important considerations:
Advertising Provider: The company providing the advertising needs to be relevant, trusted, and have the technology to accurately track the views. In order to be effective, your ad needs to be seen by the right people. You need to be confident that the advertising provider has detailed demographics on its readers. With Pay-per-Click this doesn’t matter, but with Pay-per-View it is critical.
Product Category: Some products may be unique or highly innovative and lend themselves to Pay-per-View over Pay-per-Click. For example, SunMateSolarPanels.com has a unique product for residential solar thermal air. Pay-per-Click would be useless here because no one searches for “SunMate.” Pay-per-View ads on a site like RenewableEnergyAccess.com, on the other hand, would give them the opportunity to introduce the new concept to solar dealers and installers.
Ad Content: The wording of the ad needs to be different for Pay-per-Click and Pay-per-View. A Pay-per-Click ad is specific and entreats the reader to click, but only if they are interested. A Pay-per-Click ad claiming “Free Solar Panels” but only offering them with the purchase of a $10K system will spend a fortune on clicks from everyone who wants something for free. The same ad as Pay-per-View would be far more effective on a solar-oriented site where most people who see the ad are interested in buying a system anyway.
Tracking: There are two ways to track the effectiveness of ads; clickthrough statistics and simply asking people where they heard about you. Neither method is highly accurate and depends on the product, industry, and offer. Some advertising campaigns require thousands of sales to be successful, others require only one. Typically, an excellent clickthrough response for a targeted Pay-per-View website ad is about 5 clicks per thousand views (0.5%). Newsletter Pay-per-View ads can average 3 clicks per thousand.
Pay-per-View advertising can be an ideal way to promote your product or service to a well-defined target audience. It is critical, though, that you deal only with well-known, reputable providers and that you design the advertising campaign and the ad itself with Pay-per-View in mind.