Pay-Per-Click advertising is a numbers game. Win, and your investment can mean an increase in sales of 25 percent or higher. Lose, and you will literally throw your money away.
If you're looking for pay-per-click advice, you should also consider what NOT to do. Sometimes a cautionary tale can be just as valuable as a long list of to-do's.
This article assumes the reader already knows how to set up a Google AdWords account and has a product to sell. Based on that product, you should already have a group of at least 10-15 keywords to target with your pay-per-click campaigns.
As with any pay-per-click campaign, it's tempting to throw all of your associated keywords into one bucket and name your bid price. But the real secret of winning the pay-per-click game is to focus on one group of very closely related keywords at a time.
When comparing results, smart marketers will look at the bottom line or return on investment, also known as ROI. This figure is your total sales revenue minus the total cost of clickthroughs. That number is then divided by the total cost of clickthroughs, which gives you a final ROI percentage.
Let's breeze through the easy math with a quick example: If you took a group of 1,000 impressions, got 100 clickthroughs at $1 each, and sold $500 worth of inventory, your ROI would be 400%. ($500 in sales, minus $100 for clickthroughs, divided by $100 for clickthroughs.)
The ROI is very important and it's tempting to throw most of your money on those keywords with the highest ROI. On the surface, that would make sense. But at the same time, it's tempting to tinker with your ad text with the goal of increasing your clickthroughs. After all, more clicks mean more sales, right? Especially if you've already proven you can get a 400% ROI with a certain keyword or keywords.
But a word of caution: As you tinker with your ad creative, you also need to keep close track of your ROI, because it can readily and shockingly change depending on how you entice potential customers to click on your ad.
Now, some pay-per-click campaign goals may be different. Maybe you want to increase hits to your homepage in order to increase advertising rates on your site. Maybe you have the goal of beefing up your e-mail list and want to get people to click on a link for a free tool or e-book. Or just maybe, you want to sell something. If that's the case, make sure you're hooking customers who truly want to buy. And it's easy to fall into the trap of enticing lookers and clickers who have no intention of parting with their hard-earned cash.
That's where the temptation and pitfall of offering 'freebies' comes into play. What if you offered, in your ad text, a free iPod drawing for the first 1,000 visitors? That would make sense if your keyword phrase was 'buy iPod' or 'buy MP3 player.' But what if your keyword was 'iPod accessory' or 'MP3 accessory'? Would it make sense to offer a free iPod drawing since your potential customer would be expected to already own an iPod?
Believe it or not, this is an actual example of a website owner who thought it would be a great idea to offer a giveaway in order to increase clickthroughs. Like any great idea, you have to think it all the way through to the end result. And it never hurts to ask 5 friends what they think of the idea, too!
The same thing goes for offering a free e-book. On the surface, it makes sense to advertise 'free e-book' in your ad text, along with any other enticing descriptions. But your main goal is to get your customer to purchase something along the way, right? So you could qualify potential traffic in your pay-per-click campaign by specifying: Free e-book on weightloss myths; Step-by-step guide for $47.
At least then your customers would get the idea that they could get something more valuable by spending a little money. They may even click on your ad with the intent of purchasing something before you've even given them your best pitch!
So keep a close eye on your ROI as you test different ad texts. More clickthroughs on a keyword doesn't always translate into more sales. Watch what you're offering, make sure you qualify traffic with the right words, and maybe you can increase your ROI on an already high-performing group of keywords.
Copyright © 2006 by Diane Metz. All rights reserved under U.S. and international law.
Author & SEO specialist Diane Metz is available to write free, exclusive content for websites. Her sites include Crown CD Manufacturing (http://www.crowncd.com/), which specializes in CD duplication and CD replication.
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