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PPC Advertising - Can It Produce Sales?

by Albert Weiss

Pay Per Click advertising is also known as PPC. With PPC, you pay the search engine every time someone clicks the link in your listing and goes to your website.

Face the facts, it will probably take between 6 and 12 months to evade being deliberately filtered out of the SERPS by Google. Even after that, you will still have to wait until your website begins to rank high enough in the orgainc listings to start receiving clicks and traffic. So in the mean time you can get your ad listed at the top of the search engine pages by using PPC advertising

Like lots of other areas of Internet advertising, keyword study is an important part of PPC. You need to know which keywords and keyword phrases the preponderance of people are employing to search for what it is that you are selling.

When you start a PPC campaign, you are actually involving yourself in an auction. You and your competitors will bid on the keywords and keyword phrases that are used the majority of the time, with the highest listings going to the people who bid the most money. The more that a business is willing to pay for the clicks, the higher they will be listed in the paid listings, which are usually at the very top of the page and down the right side of the page.

PPC has become highly aggressive for many of the popular keywords, which can sell for anywhere from five cents per click to many, many dollars.

PPC is often filled with falsified clicks. Competitors will click on your ads to drive up your PPC bill in order to try to get you to stop advertising. There have also been some lawsuits regarding fraud that is perpetrated by the search engine companies themselves. And the Plaintiffs won at least one of these lawsuits that I read about.

I could write a lot about this area of advertising. But I think that your interests would be better served if I just "cut to the chase." Conversion rates vary widely by industry on the Internet. But the rate of conversion is similar to what is found in the mail-order business, between one half of one percent, and two percent. In the real world, projecting a one percent conversion rate would be fairly safe, though there are hundreds of variables that can make the one percent estimate way too high.

What that means is that out of every one hundred clicks on your links, you might get one actual sale. So if the markup (Gross Profit) on your average sale is fifty dollars, and your clicks cost you fifty cents each, you cannot afford PPC because one hundred clicks X fifty cents per click = fifty dollars and you just broke even.

Remember, "Gross Profit" does not include your overhead. It's only the difference between the selling price of your item and the cost of your item. So in the example given there was in reality a loss of money. You have got to know what your costs are, and that includes how much it costs to own your equipment, pay your rent, ISP, etc., plus the value of your time.

The bottom line is that most pay per click has been bid up way too high by the larger businesses and it is difficult or impossible for a little guy to make money using pay per click promotion.

Watch out for of the companies who will offer to handle your pay per click promotion for a fee because they cannot change the laws of math or physics. They will claim that they have the experience to help you, and they might. But they still cannot change the laws of math or physics.

I've found that pay per click promotion can work, but you have got to cautiously do the math. Can you make a reasonable profit based on the above calculations if you pay the current bid price for the keywords and get only about a 1/10th of 1% or 2/10ths of 1% conversion rate (sales rate)? If you can, then pay per click promotion might work in your case.

I advise you to stick with niche terms that have not been bid up to high. Personally, in my industry I'm only willing to pay between 15 cents and 40 cents maximum per click, and my products sell for between forty and one hundred and fifty dollars.

PPC marketing? Do the math first, and then decide. But you should be willing to lose money while you find out how to make it work effectively!

Personally, I've found several SEO methods that are much more effective than PPC. These other methods have led me to promote my website to the first page on all of the major search engines for the most popular keyword phrases in my industry. A reason that these other techniques are much more effective is that they cost little or no money at all. And most people searching the Internet attribute a lot more trustworthiness to ecommerce sites that rank high in the organic listings vs the sponsored listings.

By using these techniques, in well under one year, I've made my ecommerce site rank as well as or better than other websites in my industry that have been at it for 10 years or more!

In the longer term, you will want to optimize your site and work on getting backlinks to raise your ranking in the organic listings. Many people have used reciprocal linking to promote ecommerce websites.

However, one-way backlinks are much more effective at raising your standings in the organic listings. I've been very successful at getting one-way backlinks and I've documented the steps I took to get lots of free traffic to my ecommerce site to make it successful by using article marketing.

Albert Weiss, the author, has written up how he gets lots of free traffic to his ecommerce site by relying on article spinning, as well as other effective SEO methods that you can employ for free. Visit his Free SEO Information site to find out who the real SEO Experts are.

Published May 14th, 2007

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