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Pay Per Click
How badly do you want to be #1?
If you want a top spot, and either cannot wait for time and work to hopefully pay off, or just don't want to optimize your pages at the expense of a design you don't like, then Pay Per Click search engines may be for you.


What are they?
If you go to just about any search engine, you will see some listings at the top or to the side that say something like 'Sponsored Results' or 'Featured Listings'. These are almost always paid advertisements. In most cases, they work on a Pay Per Click (PPC) model. You (the advertiser) chooses a keyword or phrase you want to be listed on and you bid against other webmasters for your position. For example, if you want to be #1 on the key phrase 'fly fishing', you subscribe to a PPC service and enter 'fly fishing' as a keyword you want to be seen with. When you do so, you will see a listing of other advertisers that want to be listed on the same key phrase, along with how much money they are willing to pay the search engine every time someone clicks on their listing. You might see something like this:

Position Site Bid
1 Joe's Fly Fishing $0.27
2 Fisherman's Warehouse $0.25
3 Fish-O-Rama $0.12
4 Fishing Kingdom $0.05

In this example, if you do a search on the PPC engine, these will be the top four results you see. Furthermore, many normal search engines partner with pay per click engines, and display their results in their 'Featured' or 'Sponsored' areas. In most cases, the partners only display the top 3 results. If you do a search for Fly Fishing on one of these engines, and you click on the #2 listing, for example, Fisherman's Warehouse will pay the PPC engine $0.25 for the click you just made.


Suppose you want to be #1 in the same results. All you need to do is place a bid for your site at $0.28, and you instantly become #1... until someone outbids you. On the other hand, you may be satisfied being #3, in which case, you can simply bid $0.06, so the clicks are not too expensive for you.


In the end, you are paying for the traffic you receive.


Making money with PPC engines
This kind of advertising can get real expensive, real fast if left unchecked. It is extremely important to know what your maximum PPC bid should be. You do this by calculating your estimated ROI (Return on Investment). Here is an example how you may do this:

Joe's Fly Fishing experiences the following statistics:


75,000 visitors per month on the website, that arrived from search engine searches.
300 sales per month to those visitors.
The average profit per sale amount is $200.00


With this information, Joe knows he has a 250:1 conversion ratio, meaning that for every 250 visitors, he will make one sale (on average). He also knows that each sale is worth $200 in profit. He multiplies the profit by the number of sales to get his total profit ($60,000). He then divides the total profit by the number of visitors: 60,000 divided by 75,000 = 0.80. This means that each visitor was worth $0.80.

If this is true, Joe knows that in order to break even, he can bid no more than $0.80 per click. Now he needs to figure out how much he is willing to spend per sale. If he is willing to spend $100 in PPC advertising per sale, so that he can make $100 per sale, he should set his maximum bid amount to $0.40. This way, if a PPC engine sends him 10,000 visitors, he knows that it will cost him $4,000, but he will make $8,000.


The ROI should be checked very often, because different types of advertising will have different results, and markets change. Remember, these are just estimates that you will have to figure out based on your own experiences. Never spend more than you can afford to lose.


WHICH PPC Engines?
There are many PPC engines. Some are more popular and some are less popular. Unlike normal search engines, a wise strategy may be to concentrate on the less popualr engines for PPC advertising if you have a limited budget. The reason is that the more popular a PPC engine is, the higher the bidding tends to be for keywords. So if you are trying to get 1,000 hits, you may be able to get a #1 position on a smaller engine for a price that would make you #20 on a more popular engine. In the end, you are paying for traffic, so the less expensive #1 position may be to your advantage.

Beware of Click Fraud
Remember, you are paying per click. That means that your competition can cost you money merely by clicking on your ad. Typically, if a person at the same computer clicks an more than once in a certain amount of time, it will only be charged once, but consider the fact that some pay per click programs also have affiliate programs in which partner sites get paid based on clickthroughs from their site. What this mean is that a whole new scam market has opened up. There are groups of people all over the world that get paid simplty to go around clicking these ads, generating affiliate commissions fraudulently. While this may not seem to be a big deal, it has been estimated that this is roughly a $2 BILLION a year problem!

To combat click fraud, you can generally get refunds from the engines if you provide them solid evidence, which you can generally get through their reporting system. Still, it is difficult and time consuming. A smarter alternative is to make use of a service that will filter your PPC results, making sure you don't fall victim. ClickSentinel is considered the leader in this area. Click here to visit their site.


Do it in AddWeb
AddWeb has a section called 'PAY ENGINES'. This section provides you a listing of PPC engines that you can subscribe to. Within AddWeb, you can simply click on an engine link and it will take you directly to their pages.

 

 

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