How do you organize your keywords? Here’s the word from the Yahoo! Search Marketing team.

We’ve given this advice before, but it still stands. Whether you use Google, Yahoo!, or MSN adCenter, grouping your keywords into a tight keyword group and matching them will relevant ads is still the best way to go about PPC advertising. This is good advice for novice advertisers as well as veteran advertisers.

There is no limit to the number of keywords you can have in a group. But you need to make sure that your groups are relevant and tight. Make sure that every keyword in your group is relevant to the ad that you are running. You will get much better traffic that way and spend less on your advertising, which will lead to higher click-throughs and ROI. The overall performance of your advertising will improve and your potential customers won’t get frustrated.

Microsoft AdCenter has added a new keyword research tool that Microsoft executives hope will make the up-and-coming pay per click advertising vehicle more competitive with Google. But don’t hold your breath. Though the keyword research tool has some unique features, it is MSN, and Google still has the lion’s share of the search market.

One cool feature of the new keyword research tool at MSN adCenter is Audience Insights. With this tool you can get a little more detail about certain demographics that you are planning to target with your pay per click campaigns. That’s always good news. But the catch is it’s only giving feedback based on MSN adCeneter, where your pay per click ads will run if you choose to use that tool.

Another downside to the keyword research tool is it’s a beta add-in for Excel. In other words, unlike Google’s keyword research tool, which is web-based, you have to install it. That’s going to turn some advertisers off. And why would you want to download a tool that you have to use with Excel when you can use a free one that is a stand alone? Of course, if you use Excel to analyze your keyword lists then it may make sense for you. Some people download the CSV list even on Google AdWords. Having the MSN adCenter keyword research tool will make it easier for you to analyze the difference between Google adWords keywords and MSN adCenter keywords. It’s up to you as to whether it’s worth it or not.

The success of any endeavor begins at the beginning. The beginning of pay per click is, of course, research. But there are two types of research: Keyword research and competitor research. I bet you thought I was going to say “market research”, didn’t you? Well, I did. I call it keyword research.

Of these two types of research, which is the more important? Well, I think they are both equally important. You should do some research in both areas before you even start your PPC campaign. And here’s how to do it.

Keyword Research
Keyword research is very important. You can buy fancy and expensive software, but you don’t need to. Just use Google’s external keyword tool.

At first, don’t do an extensive keyword research. Stick to the basics. Pick 10 general keywords related to your niche and search for synonyms for those keywords. Also, don’t drill down for website content just yet. Keep your setting on descriptive words and phrases.

Next, take your top 20 keywords from this list as defined by income opportunities. You are looking for keywords that have low or relatively low competition and a high number of searches. Make sure these keywords are related to your niche and that they would be keywords that you’d actually bid on for advertising.

Competitive Research
Now conduct a search for each of those keywords using both broad match and exact phrase match. Write down the top 20 or 30 websites you find with those keywords that actually compete directly against you. These are companies that actually provide the same product or service that you do. I’m talking organic searches here.

Next, make a separate list of the top 20 or 30 competitors who have paid search ads for those keyphrases. Make these lists for each keyword or phrase you are researching.

Now you want to anlayze your two lists to see if there is any crossover. Who is ranked high in the organic search listings and still paying for premium placement with their paid search ads? Those are your most competitive competitors. Other important competitors are any competitor who is advertising using pay per click. You will be competing against them for bids. Take note on the placement of their ads within the lineup. You might want to also capture a screenshot of all the paid search ads for each keyword so that you can analyze the ad copy. Visit the landing pages of these companies as well so you can see the ad copy there and know what you are competing against (NOTE: Don’t click the ad to do this; write the URL down and type it directly into your browser’s address bar - would you want your competition costing you money when there is no chance of capturing that sale?).

Basic Research
This is very basic research. You can (and should) go deeper. But this will get you started. You want to know what your competition is doing with regard to your most important keywords. After you’ve done this original research, you can drill down a little deeper and do more comprehensive research.

The most important aspect of any pay per click campaign is the keyword research and brainstorming. This is the first thing you should do in any campaign and you should spend considerable time on it. Leave it out at your own peril.

Keyword research is necessary, but many people leave it out, choosing instead to rely on intuition or inspiration, but those are poor substitutes. The success of your campaign will be in how effective you are in choosing the right keywords based on search engine statistics and relevancy to your topic.

My recommendation is to first begin with a brainstorming session in which you write down all the keywords that you think will be relevant to your ad campaign. Then you should research the search statistics for each of those keywords using a keyword research tool, either a free one provided by one of the search engine companies or a paid one that is just as effective in helping you achieve your PPC goals.

After you have identified several hundred potential keywords you should then go through them and determine which ones are most relevant for your campaign. Some keywords might be relevant to your overall campaign but only be relevant for certain ads within that campaign. Others might be relevant for every ad in the campaign. Be sure to carefully note the limits and expectations of each keyword. This will help save you a lot of trouble later.

So how many keywords is enough? It depends. If you have a narrow niche then you might want to limit your keywords. But honestly, you should use as many keywords as you can use without watering down your niche concept. You don’t want too many keywords, but you want all that are relevant. That’s why keyword research is so important.

If you log in to your Google AdWords account and perform keyword research on your niche, you’ll find some excellent search statistics through the keyword research tool. Among the statistics that you’ll be able to see are:

• Estimated Ad Position
• Estimated Average CPC
• Advertiser Competition
• Search Volume for Previous Month
• Average Search Volume
• Search Volume Trends Graph
• The Month Of Highest Search Volume

And you can see these statistics for broad, phrase, and exact match for each keyword that you research and add to your list.

These statistics are designed to help you make important decisions regarding your PPC campaigns, but you can also use them in your organic search marketing efforts as well. Pick the most profitable keywords for you niche based on the statistics and get to work. I love the Google Adwords Keyword Research Tool.

The Yahoo! Search Marketing Blog recently told its readers not to shoot for the No. 1 ad spot in every instance. I can’t think of any better advice for a search engine pay per click blog to give. In other words, the could just have well said, “We love your money, but not so much as to see you throw it down the PPC drain and never get it back.”

The search engines have an incentive for seeing you be successful. If you make money on your PPC campaigns then you’ll spend more of it on advertising.

The No. 1 spot, as Noah Belson says, is not always the best spot. When bidding on your keywords, only bid on the keywords that will deliver you the most conversions. General keywords will usually cost you more and will usually provide you fewer sales conversions, draining your budget and not giving you any sales, lowering your ROI. You might even end up with a negative ROI.

Do your keyword research carefully and figure out which keywords are most profitable for your campaign and use only those keywords. Then bid on them optimally so that your ads run longer. This will increase your chances of realizing a positive ROI.

You’ll hear marketers often talk about long tail keywords. Many of them will recommend that you focus your PPC campaigns on the long tail keywords simply because they are less competitive. But should you follow this advice?

Think about this. A long tail keyword may be less competitive, but the reason it is less competitive is because fewer people are searching for it. It will also be less expensive to bid on. There are several things to consider before you decide to bid on those long tail keywords:

• Budget - How large or small is your budget? If you have a small advertising budget then the long tail keywords might be more affordable for you. They could be a good place to start. But if you have a larger budget then you might consider bidding on the general keywords to tap into their popularity.
• Importance - Importance of keywords to your niche is a very important consideration. If a long tail keyword doesn’t match your business model then it doesn’t matter how competitive or inexpensive it is. It makes no sense to target the wrong keyword. On the other hand, if a long tail keyword is the perfect keyword for your business where the generic keyword might be too broad then it really doesn’t matter whether you spend 10 cents per bid or $1 per bid, the right keyword is the right keyword.
• Business goals - What are you trying to accomplish with your PPC campaign? Are you looking for conversions or opt ins? What are you selling or promoting? Does it appeal to an audience that is more likely to search for the long tail keyword or the general keyword?
• Targeted repelling - It is just important to repel the wrong people as it is to attract the right ones. Does the long tail keyword do an effective job of convincing the wrong market not to click on your ad? If not then it may be the wrong keyword. If so, on the other hand, then it may be the right keyword to target provided that other factors are considered.

These are by no means the only considerations you should have, but these are important to consider when determining whether the long tail keywords hold value for you. It may be that you want to target some long tail keywords and the general keywords that are more expensive to bid on. Take a look at all the angles and make a decision based on what is important for your business.

I like these two questions from a presentation by Tor Crockatt:

• Think of keywords as questions being asked by a user. You’re engaging the user by drawing them in to your site. Be honest – do you have the answer to their question? Remember the quality of their experience can affect your brand positively…..and negatively!
• Think about what you are actually selling and don’t expand your keywords so much that they don’t relate to your content. For instance if you sell bath tubs, don’t be tempted to bid on keywords for shower equipment just because they do the same thing.

Using keywords to answer questions by your users is a good tactic. If you think about the questions that users would have of your product or service you can use the keywords to craft answers to those questions and make those answers your PPC ad description. Your ad description needs to have a call to action. If you write it in such a way that it answers the question your users are asking, or that it promises to answer the question on your landing page, then you’ll get more click throughs. But you have to make sure your landing page is ready to close the sale.

Another key point is to keep your keyword list manageable. Don’t expand it too much or you’ll be watering down your SEO. That will make your ads much less effective.

Let’s face it, some keywords just aren’t popular enough to have a year-round PPC campaign behind them. You know you’ve seen them. They’re popular at Christmastime, but you get no use from them for the rest of the year. Or maybe you see surges in popularity in the summer, but drops in other times of year. Maybe the keyword popularity goes up or down throughout the year based on holiday schedules or other influences within your industry. How do you capitalize on that?

Good question. The first step, of course, is to know and understand what causes those spikes, dips, and surges. You should also be tuned in to when they occur. It isn’t enough to know that baseball gloves are more popular just before little league season begins. You need to know when (generally) the interest in them starts. By knowing this information, you can time your ads to hit when people will start looking for what you have to offer.

Don’t start your advertising campaign when interest spikes. That’s too late. Kick it off a couple of weeks before that. You want to be the first to have your advertising in place so that you can capitalize early on when shoppers first begin to go looking for a product. Then, when the competition enters the field, you’ll already have a leg up. That will count for more than just sales. It will also make a difference with optimization and quality score.

You also don’t want to leave out keyword research. Don’t shortcut it just because it is a short-term campaign. Run it just as you would any other campaign. Start at the beginning, do your keyword research, and bid according to the value of the keywords. You can also use match types for your short-term campaigns. Run it like you would any other advertising campaign.

But you don’t have to use the spikes and surges for short term advertising campaigns. They are also useful in your long-term campaigns. The ones you run year-round. Those keywords that are a part of your campaign can have bid adjustments based on the season. You might even run a long-term and a short-term campaign simultaneously based on the seasons and times of year.

One more way to use this information is in your choice of negative keywords. Use those spikes to determine when to make a keyword a negative keyword and when to focus in on it through your bidding strategy or match type focus. The bottom line is to increase your revenues. You can do that by increasing your sales or by lowering your bids on keywords that don’t quite make the cut - even if it’s on a seasonal basis.

Do you do all of your keyword research with a keyword research tool or do you do any “manual picking?” Let me tell you why you should do both.

The advantage to using a keyword research tool is that the process is automated. It’s a lot quicker to use a tool or a service, but the disadvantage is the most keyword research tools are not exhaustive. While most tools can help you narrow down your list of keywords through extensive Web crawling and finding synonymous terms you haven’t thought of, most of them will overlook other terms that you could use that are likely appropriate for your business and could be very profitable.

That’s why I like to also suggest that you do some manual keyword research on your own. It’s not hard. There are several methods for doing this manual keyword research.

• Study the competition
• Perform keyword searches
• Take a poll

There are other ways, of course, but I’ll focus on these three for right now.

You likely know who your competitors are. Visit their websites. Go to each page on your competitors’ websites and view source. Look at their keyword meta tags. But don’t just stop there. Use a competition spy software like Secret Page Spy to find out what keywords they have on each page of their website. This is an invaluable tool.

Another way to do manual keyword search is to make a few keyword searches at each of the search engines for terms that you deem important to your business. Try to pick keywords that were not found by your keyword research tools. See how many websites pop up as available for your search term. Click on a few of the listings to see what comes up. Is it a competitor? If so, revert back to method No. 1 above.

You want to search for keywords that you think people would use to find your website. This method works real well for niche topics that are not necessarily very popular. If it is an obscure topic that only a few people might be interested in then you’ll have to think like the target customer you are going for. If you don’t find the right keywords for your niche it could be because you are choosing bad keywords, but it could also be because no one else is filling that niche. If that second one, you could carve out a particular niche for yourself and be an early leader in that niche area.

Thirdly, if you an e-mail list or a website that you can place a poll on, then design an online poll asking specific targeted questions of your niche audience and ask them what they’d like to see. You can get valuable information from people who fit your target audience. All you have to do is ask.

Do you have an affiliate program you’d like to promote through pay per click? There are two really powerful ways you can drive traffic to your affiliate promotions page with pay per click. Here they are in a nutshell:

Affiliate Landing Page - You have a landing page dedicated just to that one affiliate program, right? You should and you should optimize that landing page around one single product or idea. Don’t optimize it around the company name. Most people aren’t search for a company. They’re searching for a product. So optimize your landing page around keywords related to that product. Write your pay per click ad around the same keyword concept and drive traffic to that landing page.

Company’s Product Page - You don’t need a website for this technique, but you do need your affiliate code. Instead of sending traffic to your own website, drive traffic to the website of the company itself. If they company has a good web page that will close sells, find out what keywords it is optimized for. You can do this through services like Secret Page Spy and other research tools that will analyze web pages. Once you get the list of keywords, write your pay per click ad and in the destination URL you’ll put the company’s landing page URL there for the product you are trying to promote, PLUS you’ll add your affiliate code so that you can get credit when someone clicks on it. In the display URL, just put the company’s home page. Whenever someone clicks your pay per click ad and buys the product, you’ll get a commission.

There is a big push, of course, to run hard core SEOs out of Dodge. We mess things up for the rest of the Web by focusing on keywords, links, and such. But if it weren’t for keywords then a lot of people wouldn’t be making any money online. AdSense entrepreneurs is one group I can think of right off the bat.

AdSense, of course, is the publisher side of online pay per click advertising. Publishers create content and slap AdSense on the pages where that content is displayed. The ads match the keywords that make up that content page and some of those people are making a ton of money.

Pay per click advertisers write their ads around certain keywords so that they can ensure a proper targeted campaign. But what if natural language wins out and keyword-rich content goes by the wayside? How will pay per click advertising be conducted then?

It is likely that such advertising would still utilize some kind of tagging system that relies upon advertisers and publishers agreeing on broad definitions of tags. While keywords may not be important any more, the ideas behind those keywords will be. They are now. They’ll be more so after keywords are gone. That is what the discussion behind natural language, or semantic search, is all about.

To be honest with you, I’m not sure how feasible that is right now. I’m positive that, at some point in the future, it will happen. But when is anybody’s guess. Until then, pay per click advertisers are stuck with doing keyword research. Since keywords are still important, you might as well make the effort to get the best keywords for you campaigns.

Keyword research is one of the first things you should do before you start a PPC campaign. It’s also one of the places where you can go wrong if you aren’t careful. Many new PPC advertisers make their first mistake while conducting keyword research. Quite frankly, it’s easy enough to do and even some expert Internet marketers make keyword research mistakes too.

When it comes to researching your keywords, don’t settle for the general keywords related to your niche. That’s where most newbies go wrong. The general keywords are usually the least profitable. Your most profitable keywords will be what they call “long tail keywords.” Those are the keywords that are not as high in demand but that can drive traffic to your website and help you close the sale. Search those keywords out. It’s worth the extra time it takes to find the right keywords for your campaign.

Another mistake new PPC advertisers make related to keyword management is using the broad match. Just because you’ve found the perfect long tail keyword doesn’t mean you should focus on that word in the broadest sense. Use the match types and single out the specific keyword. If your keyword research leads you to a long tail keyword phrase that is two or three words long then put those words in brackets or quotes. Otherwise, the PPC search engine will seize upon each individual word separately. But you want to target the phrase so be sure that you use the proper match type and target your keywords specifically.

Whether you run your PPC campaigns on Google AdWords, Yahoo! Search Marketing, or MSN adCenter, you’ll need to conduct an effective keyword research study.

Without the proper keyword research, you can’t hope for success with PPC. Your ads will need to be optimized if you want them to reach your target market. The way the search engines decide when and where to place your ads depends a great deal on the keywords that you use within your ads. If you wan those ads placed where they’ll be the most effective then you’ll have to start with the end in mind. That means conducting effective keyword research.

I recommend targeting long tail keywords. Those are the keywords that could be profitable for you, but maybe not for your big business competition. The companies with big ad budgets usually go for the most generic key terms. Those will cost you some money to be competitive. But if you your keyword research right then you’ll uncover small gems that are not real popular, but are popular enough that you can turn them into a profit. The key is get a decent return on the amount of money you spend on the advertising. It all starts with making the most of your research.

In a section of a blog post about BusinessWeek columnist Gene Marks’ absurd assertions that small businesses don’t need Internet marketing, Caroline Melberg had this to say:

I’m not an expert on AdWords, but I do know people who have used Google AdWords and other pay per click models to turn a profit. You don’t need thousands of dollars. You can make money on a $200 per month budget. Many have. You just have to learn how it’s done. You didn’t know how to run a business either until you tried. Right, Gene?

She’s right. Gene Marks is wrong:

John’s a pretty smart guy. He runs a company that sells specialty pet foods. He manages his own investments. He keeps an eye on his taxes. But I’ve found a way to turn John into a blithering idiot. I’ve asked him to figure out how to use Google’s (GOOG) AdSense profitably.

It’s really not hard. You don’t have to be a genius to figure out any of the pay per click models successfully. And, Gene, it’s Google AdWords, not AdSense. AdWords is the pay per click advertising vehicle for businesses who want to advertise and bid on clicks per keyword. AdSense is for publishers who want to place ads on their website. Two different things.

That aside, just because you don’t understand it doesn’t make you an idiot. Like anything else, you have to take the time to learn it. If you can’t, or don’t want to, there are people who will manage your pay per click campaigns for a modest fee. Believe me, it’s worth it. Thousands of small business owners have managed it successfully.

The key is in ROI. You don’t need a big budget to run a pay per click campaign. You just need to do your research - your keyword research, and don’t bid yourself above your means to pay. You can control your budget. AdWords, and their competition, makes that easy.

Is pay per click advertising for everyone? No. But you don’t have to be intimidated by it if you run a small business. There are ways to make it work for you.