Per Click - Do They Know Something We Dont?

I have utilized pay-per-click (PPC) advertising since its inception about two years ago. With PPC, the advertiser is only charged when a person actually clicks on their link. The amount you actually pay for each click is referred to as the cost-per-click (CPC). I've got to admit, I was pretty leery at first. But since then I've watched the price of certain search engine keywords skyrocket in excess of $10 per click! The big question isn't how much it costs per click but how many clicks does it take to get an acquisition. I've often asked myself, why would so many companies pay that much money for one single, measly, push of the index finger? The answer is simple - it just works!

HOW TO JUSTIFY $10 PER CLICK

The advent of PPC advertising has changed Internet marketing forever. It represents a free market in much the same way as eBay -- controlled by a natural supply and demand relationship. For a keyword phrase such as "debt consolidation," the top five advertisers are willing to pay cost-per-click charges of $10.01, $10.00, $9.99, $7.00, and $6.97. My first reaction was, something has to be wrong with this picture - it just can't be! So I looked at the "life insurance" phrase, where the top five range from $7.00 to $3.50. Then there are drugs like "Xenical" that range from $6.76 to $6.74. There are many more examples where the cost-per-click exceeds $6.00, $7.00, or $10.00, but you get the point.

The fact of the matter is that while PPC advertising can work quite well - it can also be a flat out failure. When companies are willing to pay more than $5.00 per click, you can be pretty certain that they have figured out how to make it work - otherwise they wouldn't pay those prices.

THE SELECT FEW

I have seen many situations where PPC will work for one company but not for another in the same industry, using the same keywords. Large and small companies will venture in, bid for a week or two, and then drop out -- never to be heard from again. Some will come in, drive the prices way up then drop back out to obscurity. The select few who are successful have found the secret -- a combination of patience, determination, creativity, keyword selection, management and analysis. They do the math, every day - they manage the bids, every day - they look for new keywords, every day - they analyze the results, every day. It takes a great deal of work to figure out how to make PPC advertising deliver results, and the ones who have are now benefiting - every day.

WHAT IS THE COST OF AN ACQUISITION?

In order to determine if your PPC advertising is justified, the first thing you need to understand is your current acquisition cost - what does it now cost to acquire a new customer or order? It's amazing how few companies know what their cost of acquisition is. To keep it simple, take your total advertising expenditures and divide it by the number of new acquisitions (orders or customers), that should give you a rough estimate of your cost per acquisition. Similarly, after running a PPC campaign for a month, you take the total advertising expenditures divided by the number of acquisitions. Of course, these raw numbers are not burdened by administrative costs, but they still provide an apples-versus-apples comparison.

I have managed PPC campaigns where the average cost-per-click was $0.40 and others where it was $5.00. The key question remains: how many clicks does it take to get an acquisition? If the cost for each click is $0.40 and it takes 200 clicks for an acquisition, then the acquisition cost is $80.00. If the cost for each click is $5.00 and it takes 10 clicks, the cost of the acquisition is $50.00.

FINDING THE GAPS

Two key points are crucial: (1) how much does it cost to get an Internet acquisition compared to traditional methods? and (2) what is the value of a new customer? In some businesses a new customer is worth $1,000, while in others, only $10. Typically, the cost-per-click reflects this value, but since the market is still very small, there are significant gaps. Remember the "debt consolidation" keyword phrase above? The difference between the first and last cost-per-click was about 30%. On the other hand, there is literally no difference between cost-per-click rates for the keyword "Xenical". From this you may conclude that there is a lot more competition for "Xenical" then there is for "debt consolidation". The opportunity is between the gaps in the 30% differential example.

The bidding market for keywords is still so new and untapped that it's rare to have more than three competitors fighting over a specific phrase. The gaps in keyword cost-per-click charges such as "debt consolidation" are the norm and represent tremendous opportunities still available in this media. Right now they are plentiful, and for those few people who take the time to understand this important marketing tool, the time to act is NOW!

About The Author

Neal Lebar has proven that Internet marketing can generate returns far greater than traditional media. For more information, visit www.innovate-inc.com or e-mail www.innovate-inc.com

Wood Dale Chicago prom limo .. Lockport Chicago limo O’Hare
In The News:

Fueled by artificial intelligence, CyberDog the robotic dog is designed specifically locate fire ant nests, which are endangering ecosystems.
Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents
Internet browsers are useful, but they can be dangerous. Clicking on malicious links can direct you to dangerous websites that steal information or infect your device.
Apple's latest iOS update introduces advanced artificial intelligence capabilities, which may be capturing and analyzing sensitive information.
Breach site confirmed 56,904,909 Hot Topic users' data leaked online. Tech expert Kurt “CyberGuy" Knutsson says the company's silence makes matters even worse.
Tech expert Kurt “CyberGuy" Knutsson discusses how an innovative Easy-Way kit turns standard strollers electric, simplifying navigation for parents.
Tech expert Kurt “CyberGuy" Knutsson talks about T-Mobile being hacked in broad cyberattack on global phone and internet companies.
Tech expert Kurt “CyberGuy" Knutsson shows you how to add, customize and manage widgets for quick access to apps and info from your iPhone home screen.
Wrong Google searches can not only compromise your device and personal data. They can also bring law enforcement to your doorstep. Hackers are targeting Google searches.
China's Shanghai Kepler Robotics has developed a new humanoid robot that can carry up to 35 pounds per hand for commercial applications across various industries
Checking your hearing has gotten easier with the new hearing test feature in AirPods Pro 2. You can take reliable hearing tests using your iPhone or iPad.
Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.
Kurt "CyberGuy" Knutsson explains how a VPN — virtual private network — works and how running it can slow down the operation of your device.
The WalkON Suit F1, an exoskeleton developed to help people with disabilities, can actually walk over to a person in a wheelchair, solving a major problem.
ClickFix, a new scam targeting computer users, is on the rise in the U.S. The scam prompts its targets to click on a link to fix a problem.
Skydweller is the world's largest unmanned solar-powered aircraft that can stay airborne for weeks, and even months, without refueling.
The U.S. government said it is investigating after People's Republic of China hackers targeted commercial telecommunications service providers in the U.S.
Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.
Scammers are using increasingly sophisticated ways to lure unsuspecting victims, and some are impersonating an email help desk or support team.
You can unsend or edit your iMessages with the latest iOS updates. Kurt the CyberGuy explains how you can save yourself some potential embarrassment.
Kurt “CyberGuy" Knutsson says there’s been a rise in cybercriminal services using hacked police and government emails to send subpoenas and data requests to U.S. companies.
Kurt “CyberGuy" Knutsson discusses how Axiom Space and luxury designer Prada are collaborating on NASA's Artemis III spacesuit design.
Voice assistants may cause confusion across devices. Tech expert Kurt “CyberGuy" Knutsson offers some solutions to fix it.
Shameless scammers trick veterans into giving personal info or cash. Tech expert Kurt “CyberGuy" Knutsson explores five common scams.

Adsense Secrets

Pst! Wanna know some Adsense secrets? The only secret is... Read More

Managing PPC Campaigns Inhouse

Pay-per-click search engine advertising has generated ample interest in the... Read More

Adsense Marketing: Brand Performance

Google developed a prime product, Adsense. Marketing your website through... Read More

What You Need To Know About Googles New AdWords Affiliate Policy

A lot of affiliates are selling other people's products with... Read More

Protect Your ClickBank Products from Online Theft

One of the biggest problems faced by ClickBank merchants is... Read More

Discover the Art of the Pay-per-Click Start (Round 1 of 2)

Setting up a pay-per-click campaign is simple, right? Practically all... Read More

When Adsense Makes No Sense: Knowing When Not To Use The Google Adsense Pay-Per-Click Program

Google's AdSense program is a proven money-maker that has enriched... Read More

The Pay Per Click Mistakes Of A New Marketer

My first real foray into Internet Marketing was a Pay... Read More

7 Explosive Strategies to Maximize Your Google AdWords Campaigns

If you ever used Google AdWords to advertise your product... Read More

How You Can Make Serious Money Self-publishing With Adsense

Some folks may think that self-publishing began with the invention... Read More

Pay-Per-Click Marketing & Natural Search Engine Traffic

PPC advertising has many great benefits. First of all, you... Read More

AdWords Campaign Set Up Tips

It's easy to overlook the basics of a strong AdWords... Read More

Sell Multiple Products Through a Single ClickBank Account

A ClickBank merchant account allows you to define and sell... Read More

How Does Pay Per Click Marketing Work?

So how do people find my website? This is by... Read More

Google Adsense, The Smart Way To Earn

Do you want to get paid for posting ads on... Read More

What The Adsense Top Earners Are Doing To Constantly Increase Their Earnings

It is really frustrating, is it not, to log into... Read More

How to Maximize Paid Search Results

Because of increasing competition that has led to higher advertising... Read More

Organic Natural Search Engine Optimization versus Pay-Per-Click Search Engine Advertising

When you purchase visitors or "clicks" from a search engine,... Read More

PPC ClickFraud: Its a Bigger Problem then You Think

Pay per click search engine advertising is one of the... Read More

How to Take Advantage of the New Google Adwords Changes

On Friday, July 15th all Google advertisers got the email... Read More

Pay Per Click and Search Engine Optimization ? A Perfect Marriage

Pay per click or search engine optimization, which one should... Read More

MSN PPC Advertising Behavioral and Demographic Targeting: Killer App. or Achilles Heel?

Examining the failures of the web content design of many... Read More

Ten Tips for Affiliate Marketers Using Google AdWords

One of the hottest ways to sell affiliate products is... Read More

Making Google Adsense Work For You

If you have been online for quiet some time you... Read More

10 Powerful Tips to Optimize your Google AdWords Campaigns

Google announced in January 2005 significant changes in their popular... Read More

Antigo wedding limo ..