cost-per-click advertising explained

Everyone who uses the Internet has seen AdWords, and probably clicked on them too. They're the little ads that come up in Google (among other places) when someone searches any phrase at all.

The genius of AdWords is that it is intimately linked to Google's search engine, so that people see ads that relate to the very topic they are searching. This means that ads are always targeted to a specific audience—the people who want exactly what you have to offer.

Cost-Per-Click: The AdWords Way

AdWords has many great features.  Perhaps one of the greatest is that you only pay Google for advertising when someone clicks on your ad. Let's say an ad appears 100 times in Google (or, as we say, has 100 impressions).  Out of those 100 impressions, it is clicked on 10 times (has a 10% click-through rate).  You only pay for those ten clicks, even though your ad was shown 100 times. This is known as Pay-Per-Click (PPC) or Cost-Per-Click (CPC) advertising.

The Power of AdWords

Google is used for a majority of all keyword searches on the Internet. If you want to know, buy, or find anything—no matter what it is—most people go to Google. With AdWords, the power to reach vast numbers of your target audience is within your reach at a magnitude never before possible.

Take this example:

Imagine that you are an online retailer of vermiculture, ahem, worm poop. How on earth would you ever track down enough worm-poop-seeking people to stay afloat? With AdWords, that's how! Google's Keyword Tool allows us to see that over 22,000 people search the term "vermiculture" in Google EACH MONTH (see chart below). Who better to advertise to than the people who are searching for exactly what you're selling? Without AdWords, you're needlessly missing out on targeted sales opportunities each month. After all, what other advertising medium can reach such a vast yet targeted audience? How else can you find so many people who want exactly what you have? This is the power of Google AdWords.

Your AdWords Account

At Blue Brain, we will set up and actively maintain an account for your company so that when people search for keyword terms, like "vermiculture" (and hundreds of other keyword phrases that that directly relate to your business), they will see an ad that links to your site.  Each keyword phrase will have its own unique ad, creating a highly specialized campaign that will result in more people finding and visiting your page.  The more people who visit your page, the more likely you are to succeed.

The Right Traffic

Obviously, we want people to click on your ad.  But we want the right people—the people who are actually looking to buy worm poop from you.  What if hundreds of people click through to your site each month that are looking to learn about vermiculture?  You're spending money on clicks that don't turn into conversions, i.e. actual sales.  Simply put, you're wasting your precious advertising dollars.  We know how to use AdWords to direct the right people to your site, so that your money is spent finding customers who are most likely to benefit your business. 

Will My Ad Appear At the Top?

Ads are displayed according to a bidding system and its click-though-rate. For each keyword phrase, we set a maximum bid—the maximum dollar amount we are willing to pay for each click and continually optimize your ads to for better and better click-though-rates. This results in good ad placement for our clients.

Undoubtedly, ads preform the best when the show up on the first page. But does being #1 in the search results increase your ROI? Not necessarily. Depending on the product you're selling, the average cost-per-click, and the conversion rate, we can determine the position that will maximize your ROI. Although it seems counter intuitive, your ROI can often be greater when your ad appears in a lower posotion.  

Here's another intersting feature of AdWords: whenever a phrase is searched for, Google serves up ads from the best, and not necessarily highest, bidders. Sometimes keywords without the highest bids actually hold higher spots in Google. At Blue Brain, this is a strategy we like to use.

Take this example:

Let's say your competitor bids $1 for a keyword, and that the corresponding ad has only a 1% click through rate. This means that Google makes $1 for every one hundred impressions (every one hundred times the ad is displayed). 

Then we come along. We bid only 50 cents for the same keyword, but manage to get your click through rate up to 3% (by constantly split-testing different ads). This means that for every 100 impressions, Google is making $1.50—which is 50% than what they make when they show your competitors ad (even though you're paying half of what your competitor is). So Google actually prefers your ad, even though we are bidding far less. Google then gives you a higher placement than your competitor and you, in turn, are more likely to generate business. 

GOOGLE SUCESS STORIES

Watch the video below to see how others have used Google AdWords to sucessfully market their business.