Do You Pay-Per-Click? Should You?

Writing by Nick on Friday, 19 of October , 2007 at 5:42 pm

There’s been a big argument over pay-per-click advertising since its inception into the Internet marketing realm. The SEO purists argue that pay-per-click advertising isn’t necessary because 80% of your traffic comes from organic search. Since that’s where most of your traffic is going to come from then that is where you should focus your efforts.

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On the other hand, pay-per-click advocates argue that pay-per-click advertising delivers more targeted traffic than SEO. They claim that the 20% of the search traffic you get from pay-per-click advertising are from people more likely to buy from you. Another argument says that people who see your pay-per-click ad will see you as a more serious advertiser and do business with you before they will someone who relies only on search.

Why You Might Not Pay-Per-Click

All of these are valid arguments. I agree with the advocates of pay-per-click on all of their points. But there may be other reasons you don’t want to use pay-per-click advertising. But I think this argument qualifies very few people. If you have a product or service that is very low-priced and the cost of pay-per-click advertising is too much for you to gain any serious ROI then you probably don’t want to use it. Let me rephrase that:

If the cost of your product is such that pay-per-click advertising requires you to spend more per click that you can hope to convert into sales and make it worth your while then you might want to stay away from pay-per-click. For instance, if you sell a $3 e-book and all the keyword phrases that would drive traffic to your website cost you over $1, in order to profit you would have to convert 1 out of every 3 visitors that come to you through pay-per-click. If you can’t do that then you’ll lose money. That might not be so good for your business.

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An exception to this rule, actually two of them, might be when the long-term benefits of branding your company make losing money on your pay-per-click campaign more profitable in the long run and - the second reason - when you have sufficient conversions coming from your organic efforts that you still profit overall the loss on your pay-per-click is insignificant in comparison.

Apart from these arguments, I think most companies can benefit from pay-per-click.

                      Category: PPC Launch, PPC Management                      

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