Optimizing Your Pay Per Click Performance

    January 24, 2003

Pay per click search engines have become one of the most popular ways to market your site in the last few years. There are now hundreds of millions of dollars spent each year on this form of advertising. Unfortunately, it has got to the point now where only companies with big budgets can compete for the best keywords … or has it?

For those who don’t know, a pay per click search engine allows you to bid on keywords. The higher your bid, the higher you are ranked. Then, when a person clicks on your link, you are charged the amount that you bid. Examples of this are Overture (http://www.overture.com), Google AdWords (https://adwords.google.com/select/), FindWhat (http://www.findwhat.com), Kanoodle (http://www.kanoodle.com), GoClick (http://www.goclick.com) and SearchFeed (http://www.searchfeed.com). It is marketed as “results based advertising” and whilst this is not really the case, it can still be very useful to use if you know how to do it.

Overture and Google AdWords are the two that will provide the most traffic. I should point out that Google AdWords is the name that Google uses for the ads that appear on the right hand side of the screen when you do a search. The problem that most people encounter with these two in particular is that to get a good listing, you need to pay a lot of money. For example, I looked up “Search Engine Optimization” on Overture and the company that was listed first was paying about $7.90 per click! Google’s system works slightly differently from the others but to be listed first, you do need to pay quite a bit.

So, could you make a profit paying $7.90 for each visitor? The answer for 99% of web sites is no. I even doubt that the sites that are paying this much would be getting a return on their investment but they would have a yearly advertising budget that allows them to pay this much.

Now, there are a few solutions to this problem. First, I’ll look at not advertising with Overture or Google. The other PPC SEs listed above don’t get the same traffic as the big two but they do get a lot of searches in their own right. For example, GoClick claims to get around 120 million searches per month. So, to get better value for money, focus on these search engines. For the search term I used in the example above, all of the four smaller engines have far lower top bids – most are well below $1.00 per click. Apart from saving money on getting a number one listing, it also means that if you can only afford to bid $0.05 you may make the first page of results – often you will actually get quite a good listing.

You will receive less traffic relative to the listing that you achieve but, you will get more traffic relative to the amount that you pay.

OK, the next step. People don’t all use the same keywords when they search. For any one keyword or phrase, there are usually hundreds of variations that people have used. If you bid on the most popular search term and only bid the minimum available – $0.05 on Overture and Google, $0.01 on the others – you will be listed very low down. As a result, you will receive very few clicks, if any, each month. But, if you find keywords that only get searched for a few times a month, you can easily get listed at number one and get a click for every search.

Here is an example using the above phrase “search engine optimization”. On GoClick last month, this phrase was searched for 4183 times. If I bid $0.01, I will be listed at number 37. As you can imagine, that will be lucky to generate one click. The phrase “search engine optimization specialist” was searched for 1129 times. By bidding $0.01, I can get listed at number 14. So, far less searches but I should get a few clicks. The phrase “searchengine optimization” was searched for 109 times. If I bid $0.01, I will be listed at number one (which you will see, I have!). So, I will get a reasonable number of clicks from those 109 searches. Not all but at least 20. By finding the phrases with less competition, you can almost guarantee a return on your investment. Sure, the more you bid on more popular search terms, the more traffic you will get but advertising should always be viewed in terms of ROI (return on investment). There is no point in paying $0.50 per click to get more traffic if you don’t get enough sales to cover the expense.

So, bid on everything that people search for – not just the popular keywords. Most PPC SEs have a suggestion tool that shows you how often people search for particular terms. I prefer GoClick’s because it provides hundreds of suggestions – the others only tend to provide 50.

The third step to optimizing your pay per click search engine performance is to focus on conversion rate. You need to know exactly how much you can afford to pay for each sale. Let’s say you sell a product for $100.00 and you are prepared to pay $20.00 for each sale and still make a profit. Assuming that you get a conversion rate of one in a hundred, you can pay $0.20 per click. But what happens if you get 1000 clicks and no one buys anything? That’s $200.00 down the drain.

Therefore, you need to work out a general conversion rate for each PPC SE and possibly each search term (I don’t actually worry about this). To avoid losing too much money, I prefer to bid low amounts when testing. So, attempt to get 1000 visitors for the lowest cost possible and then work out your conversion rate and your ROI. If you pay $0.05 per click and get a 1 in 100 conversion then that’s good. If you get a 1 in 50 conversion rate, that’s even better and it let’s you know that you can afford to bid more for each keyword or phrase, get more visitors and make more sales.

From a small business point of view, I may have money to spend on PPC SEs but I never have money to waste on them. By working out exactly how much you can afford to bid on each search engine (because they are all different) you can actually achieve your goals – increase sales and increase profits.

To finish up, I’d like to discuss a couple of other points in regards to advertising with PPC SEs. First, every time someone clicks on your link and doesn’t buy, you’ve lost money. Not much money but as you are paying for clicks, you want there to be as little wastage as possible. If you use hype in your title or description, you will generate clicks but generating sales is different. So, to get value for money, it’s often best to try to get people not to click on your link. This is perhaps a touch extreme but if you are targeting an area that gets lots of surfers, you will end up paying for lots of click and not getting many sales. Things such as games and sports betting are topics where people are looking for “free stuff”.

So, if someone isn’t going to buy something, don’t try to convince them to click on your link. Again, this is about testing for conversion rates. I have seen it mentioned elsewhere that putting your price in your description will put off people looking for freebies. I agree with this to some extent but I think that this will, on occasion, lose you sales because you don’t have the opportunity to sell to them. Maybe your site could convince them that what you offer is worth the money. So, you don’t have to include the price but don’t mention free stuff either if you want them to buy something.

Now, the last thing I want to talk about is something that is often ignored by people when the advertise on search engines. That is, branding. If you include the name of your site in your title and/or description, you at least get people to see it. They won’t all remember but some will. Marketing a web site online is often about making the most of every opportunity – especially if it’s something that doesn’t cost you anything. If someone doesn’t click on your link, at least get them to see your name. In all my titles, I have WebmastersReference.com. By having that, I am getting my name out there (often to thousands of people a day) and some of these people may come and visit me later. If I just have Search Engine Optimization Services as my title, there is no way they will ever find me again unless they come back and click on my link – which I have to pay for.

Never miss an opportunity to have someone see the name of your site.

So, just to sum up how to optimize your PPC SE results:

1. Advertise with the smaller PPC engines to save some money on your bids,

2. Don’t just target the main search terms, target all of them,

3. Test for conversion rates and ROIs,

4. Don’t use hype. You want customers, not surfers,

5. Branding – make sure everyone sees your site name,

Follow this advice and you will not only be more profitable but it will help your site in the long run.

Click here to sign up for FREE B2B newsletters from iEntry!

Sean Burns is the author of the WebmastersReference.com Newsletter – http://www.webmastersreference.com/newsletter. More than five years of experience in site design, marketing, income generation, search engine optimisation and more is passed on to subscribers – hype free. Sign up today to get real information of real value to webmasters.