Don't Put Your All Your Advertising Eggs In One Basket
If you have spent any time promoting a Website online, you have
no doubt encountered Google Adwords and Yahoo (formerly
Overture) Search Marketing. We hope you have seriously
considered advertising your products or services using their
networks - because they work - and in almost all cases extremely
well.
If you are familiar with these pay per click (bid for placement)
advertising networks, you are probably thinking to yourself
"There is no reason to advertise on second-tier networks - I get
all the traffic I need from the big players. There is nothing
that a smaller PPC ad network can offer me that the services I
currently use cannot." However, if advertising on those networks
worked half as well as their marketing and public relations
machines would have us believe, second tier ad networks such as
Miva/Findwhat and 7Search.com would not exist.
What most small and medium sized business advertisers often do
not realize (if you are not into the nitty-gritty of Internet
advertising or do not live and breathe online media buying) is
that these other networks not only exist but provide a
comparable if not better return on investment (ROI) than either
Yahoo! or Google Adwords.
The reason (most likely) is because people typically associate
ROI with response rate or total revenue instead of the actual
revenue they see from their advertising spends. Advertise at
Yahoo! and there is no arguing that you will see triple the
number of clicks and possibly twice the number of sign ups than
the campaigns advertised at smaller PPCs. What you will also
undoubtedly see is that the cost of running a campaign on Yahoo
is exponentially higher (in individual bids and overall ad
spend) which seriously impacts an advertiser's bottom line.
You Heard it Here First; It's All About the ROI Essentially,
more traffic in no way correlates to a better return on
investment (ROI). If smaller pay per click advertising networks
provide an equal return on investment (and often in some
business verticals they do) these companies can not only survive
but thrive in the competitive online advertising landscape.
Research conducted by Rich Leino of WebsiteMaven.com provides
insight into the actual return on investment generated through
these second tier networks (Table available online at Website Services
Magazine).
Research was performed by following clicks from each PPC network
and tracking them through to a conversion. A conversion is
usually a sale but can be anything that the website owner
desires for the user to do: register for a newsletter, join a
forum, register in a contest, etc. By assigning a value to the
conversion and by tracking the cost for each click that comes
from a PPC network, it is possible to determine what the average
cost for each click was as well as how much income, on average,
each click generated.
Gain is calculated by subtracting the cost from the income. ROI
is calculated as a percentage of gain divided by cost. An ROI of
100% means that for every $1 cost, there were $2 in income.
It is important to note that popular keywords performed very
poorly for some second tier networks. A popular keyword is one
that is searched for very frequently by consumers and, hence,
sought after by advertisers. Research revealed that Yahoo!
Search Marketing, Google Adwords, 7Search, and MIVA had
excellent ROI for even the most competitive keywords while
Kanoodle and Enhance performed extremely poorly due to apparent
click fraud. On niche keywords, with less competition, the same
PPC networks performed well while Enhance and Kanoodle continued
to perform very poorly even for niche categories.
While it is hard to deny the benefits provided by both Yahoo
Search Marketing and Google Adwords, it is essential for pay per
click (also known as bid for placement) advertisers to utilize
second tier networks to supplement traffic generated from the
larger networks, as long as those second tier networks can
provide a comparable return on investment. While no one in their
right mind would suggest that website owners put all their
advertising eggs in one basket, if you plan on getting out of
the Internet henhouse with the most eggs (a high ROI) in tact
you may want to consider using several different baskets.
About the author:
Pete Prestipino is the managing editor of Website Services Magazine
- the only print publication providing information on how to be
more successful online. Get a FREE SUBSCRIPTION at
WebsiteServices.com/Subscribe or visit WSM's
weblog for the best practical advice every day.
Written by: Pete Prestipino - Website Services Magazine
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