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Pay-Per-Click Domination by Dale King Google and Yahoo generate an estimated 5 billion dollars in combined pay-per-click earnings each year. 5 billion dollars...wow! Yes, my friends, pay-per-click advertising is big business. So, where and when did this whole ppc thing get started? In the summer of 1996, search engine, Open Text Index, began selling web site owners a "preferred placement" on the page. The idea, akin to that of Goto.com, also was compared to phone company yellow pages. The company said it was responding to market demand for the feature. It didn't work out, however. Consumers complained, and the company dropped the idea. "We got in so much hot water [with users] that we took it out within two to four weeks," said Mark Kraatz, manager of corporate Web systems for Open Text. "They thought it was tainting the search." Overture was launched as search engine GoTo in 1997. In February 1998, it shifted to its pay-for-placement model. The company changed its name from GoTo to Overture in October 2001. It was purchased by Yahoo in October 2003. In October 2000, Google announced its new content-targeted advertising program. Google AdWords was a huge "out-of-the-box" success, boasting well over 100,000 advertisers to date. So, what's the appeal of ppc? There are several good reasons why advertisers choose to pay for visitors to their website as opposed to the more costly, involved and often grueling method of search engine optimization. Improper SEO will not only waste time and resources, there is never a guarantee that the keywords your site is optimized for will result in actual sales or conversions. In addition, with the ever-changing algorithms of search engines, you could spend big money on SEO that may put you at the very top of the search engines today, and then with one major algorithm change, you could drop completely off the charts tomorrow. (Remember Florida?) PPC advertising can help ensure for the most part, you get what you pay for and pay as little as possible to do it. And with Google Adwords, you can literally start driving targeted traffic to your website and making money in just a matter of minutes. Are there negatives to ppc advertising? Yes, click fraud. It is estimated that 30 percent of all ppc clicks are fraudulent. In fact, according to the June 28 issue of the San Jose Mercury News, both Google and Yahoo recently had to settle class action lawsuits regarding this very issue. So, what is the future of ppc? Personally, I think we're moving closer and closer to a model like "Cost Per Action." What's Cost Per Action? CPA is an an online advertising payment model in which payment is based solely on qualifying actions such as sales or registrations. Snap.com is a perfect example of a CPA model. Snap's ground-breaking Cost-Per-Action (CPA) business model enables advertisers to guarantee that their marketing expenditures are cost-effective. Other search engines charge advertisers each time a user clicks on an ad link with no guarantee that the user will follow through with a transaction of benefit to the advertiser. However, Snap's CPA system only charges advertisers when the user actually follows through and purchases an item, fills out a form, makes a donation, or whatever criterion the advertiser establishes for the campaign. Snap's various features are also designed to appeal to the Internet's most frequent searchers, providing a highly focused environment in which to stage advertising campaigns. All you have to do is copy, paste, and configure one line of HTML code in your conversion web page. This is the mechanism by which Snap knows when a conversion takes place. In closing, so far Snap.com has solid traffic numbers to back it up. Therefore, it will be interesting to see if its CPA model can challenge the ppc model dominated by Google and Yahoo. About the Author: Need Marketing Help? |
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