Not Knowing The Cost Of Pay Per Click Advertising Can Hurt You

The cost of pay per click advertising is still under a lot of debates among advertisers and web owners, as to whether or not it is worth it.  The pay per click marketing industry has grown into a multi-million business which does not even show any sign of going down as studies indicate that it brings a very high potential of driving more traffic to websites.

The numbers also speak for the confidence level of websites and searchers alike on pay per click advertising.  For instance, billions were spent on online pay per click programs, consisting 81% of the total money spent on marketing and advertising for search engines.  Despite the big numbers, reports still show that search engine users never click on any of the paid search listings.  Thus the question of whether or not these listings are worth the price that advertisers have to pay for.

Understanding the value of the cost of pay per click advertising starts with understanding how much the keywords will cost.  Each year, the costs or keywords significantly increase by as much as over 40%.  Despite this, advertisers still end up spending much on bidding keywords even if it is evident that the returns would rarely exceed the costs.

When Numbers Speak For The Real Cost Of Pay Per Click Advertising

In a certain survey, it was revealed that more than half of the respondents felt that the keywords and phrases that they needed were “too expensive” while another half thought that they are spending too much for bidding on keywords.  In fact, during the holidays, the bid rates of keywords could increase by up to 100%.  On an average, cost per click in the biggest search engines like Google, MSN or Yahoo start at $0.05 for every click, though the average cost for a high ranking keyword is usually over $3.30 for every click.  There are even some keywords that are rates at more than $150 per click.

Looking at those numbers, the cost of pay per click advertising can actually be higher considering that it is evident that about 15-30% of the click-throughs are still fraudulent.  This makes some advertisers who failed in getting results form pay per click online that it is a waste of money to invest in this medium.  Thus, the question remains: is PPC worth its cost?  This is still a question of whether investments on pay per click returns on time, not later when too much money and effort has already been spent.

One disturbing number is that 80% of searchers report that they never clicked on sponsored listings on search engine.  This translates to a phenomenon of advertisers spending billions and billions for advertising on search engines and websites that never really get clicked.  In fact, the conversion rates on paid sites are actually three times lesser compared to that on unpaid sites.  Moreover, it is interesting to note too that paid search can sometimes need more pay per click management service costs.  Some even spend more for automated software that takes care of bid management.

Oftentimes, advertisers question if the cost of pay per click advertising is worth at all.  Some who failed to reap results from this form of advertising have resorted to improving their rankings on organic search results through search engine optimization.  Results might not happen overnight with this strategy, though it can be a more sustainable solution in improving a website’s exposure to a target audience.

How To Stay In Control By Knowing The Cost of Pay Per Click Advertising

What the doubting advertisers do not know about pay per click marketing is the fact that what you do not know about search patterns can actually bring the costs down.  Every day, the biggest search engines send almost 2 billion searchers to websites.  Although sponsored listings on search engines might work, it can also be costly for the younger websites.

The truth is that, cost of pay per click advertising can actually go down if an advertiser knows how to make use of search patterns.  Research is an essential element to an advertiser’s success, as it can tell a lot of ways that will strategically bring down the costs of pay per click advertising without sacrificing the results.  Advertisers commonly make the mistake of aiming to bid on highly targeted keywords, which actually have higher competition among advertisers.  Such competition causes the starting bid rates of these highly searched keywords shoot up.

The smarter advertisers know that it is not the best move to invest heavily on highly searched keywords and phrases.  Spreading investments across low-targeted keywords will dramatically lower expenses on pay per click advertisement.  If you do this, you end up bidding on keywords which searchers still use to look for products and services on search engines, but which advertisers do not bid as much.  If you multiply the number of times that you have the power to bid on low-cost keywords, it actually increases the possibility that you will get results.

Calculating the cost of pay per click advertising is really beyond math, as it also involves arriving at effective strategy that could cut down costs while maintaining results.  We do not have to discount the fact too that keyword prices do increase by about 20% every year.  It is also an obvious fact that the most popular keywords do not produce positive returns due to the high acquisition cost.  In addition, the competition also knows how to go around the playing field, and they can usually hurt you by clicking on your site to purchase your name as their own keyword.

It takes a lot of experience and research to be successful with pay per click advertising, and it also pays off to calculate the cost of pay per click advertising well.  If you fail to have a good grasp of the cost, you might end up doing the wrong strategy which can hurt your business in the long run.  In the end, the ball is still in your hands and you are still the one in total control.