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You see them every time you search online...those links at the top of the page, the blurbs at the side of the page. You know they are paid for...but do they work? Will keyword ads or sponsored links bring in customers? Should you try them? What return on your marketing dollars can you expect from paid search engine marketing compared with other marketing avenues?
The latest research shows that search engines are increasingly being embraced by Internet users. Ninety percent of users use search engines, and about two-thirds of all adult Internet users use them every day. This increase in online activity hasn't gone unnoticed by advertisers. Online advertising spending is expected to double between 2004 and 2010, when it will account for 10 percent of total U.S. ad dollars. Eighty percent of advertisers already include the Internet in their marketing mix, and that figure is expected to increase soon to 90%. Search engine ad spending is set to grow 26% in 2006.
The trend is telling us that companies who spend advertising dollars see an increasing value in getting their message online and in targeting their customers through searches on search engines. In fact, advertisers spent $5.5 billion on paid search in 2005, a 67% increase from $3.3 billion in 2004.
Should your company take online advertising more seriously? The demographics of your customers will tell you. If your company is targeting consumers, keep in mind that homes run by individuals aged 35-44 are the most computer and Internet savvy, followed closely by homes run by individuals aged 45-54 years old. If you’re targeting young adults currently in college or who have recently graduated, you can’t afford to ignore the Internet in your marketing mix. Those individuals grew up using the Internet as part of their daily activities. They continue to use it comfortably to research jobs, schools, and purchases.
Which search engine is right for your company? Google has the largest market share, followed by Yahoo! and MSN. The big three search engines account for more than 80% of all local searches. Users can and do switch search engines, particularly as they get closer to making a purchase decision. In addition, don’t overlook specialized search engines that target your industry sector and/or domain of knowledge.
What should you look for in an effective pay-per-click advertising campaign? Here are five steps to ensure a successful campaign and to get the most return on your marketing dollar:
1. Do your competitive research. Study competing and alternative products and solutions. What are their search engine marketing strategies? Where do they put their dollars? What keywords do they use? What are their offers? How do they position their offerings? You can create a profile of your key and emerging competitors and develop your own competing strategy to answer their challenges most effectively.
2. Create a keyword portfolio. How do your customers approach their buying decisions? How do they frame their needs and issues? What probable solutions would they be considering? The answers will help you define where and how they use search engines to search for and identify potential solutions. Using this insight you can develop a set of keywords that will position your offerings compellingly in their search path. Here are a few tactics you can use in your creative process: Start with a few search terms, then search similar and related terms that are frequently used. Analyze your Web site log files to identify frequently occurring keywords. Talk with those on your team who interact with customers regularly. Seek feedback from your customers.
3. Set a budget. The cost per click is going up, thanks to the increasing popularity of paid search as a marketing tool. Your paid search budget impacts how aggressive your campaign can be. If you are selling business-to-business, bear in mind that the ranking of your ad has a big impact on your customer’s perception of you. Within your budget, there is still plenty of room to make each dollar count. Review the bids for the keywords and key phrases in your keyword portfolio. Typically, keywords that are general in nature are more costly than keywords that are specific and more focused. A highly competitive and more costly keyword is not necessarily the most productive. In addition to the cost per click, you will want to consider the conversion rate and the typical profile of users who convert into customers. Develop and bid on other keywords or key phrases that may be less frequently used and have a lower bid price, but are more cost-effective when considering conversion and the value of the customers.
4. Make a compelling offer. A lot of the online ads appearing in search engines look boringly similar. Think about what your customers perceive as important. What will make them pay attention? Make them a compelling offer they will happily click on to see more. You might also want to create a landing page that further explains your value proposition and your offer. The bottom line is, entice the user so he will believe and become a satisfied customer!
5. Monitor and measure results. Which ad copy out pulls the others? Which keywords are the winners? Which search engines perform the best for your campaign? Feedback from the marketplace provides the best guidance for fine-tuning your campaign. Review your sales results for the ROI to see whether your marketing dollar is working hard enough for you.
In summary, pay-per-click is an increasingly important marketing tool that you cannot ignore. It may well already have become a critical component in your marketing plan - or your competitor's. The steps outlined above will get you started on leveraging what search engines can do to increase your visibility and promote your business.
Copyright Eva Chiu and InfoAdvantage.
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