Search Engine Advertising – Why Use It, and How Much Does It Cost?

Last Updated
July 20, 2010

Why Use PPC ads?

Unlike most standard forms of advertising, search engine advertising targets potential customers who are directly looking for keywords related to your service. This means that they are usually actively sourcing information on a product/service in your area of business.

So what can your search engine ads do for your business?:

Bring People to Your Site

Your ads can be used simply to bring people to your site. This could be to increase visitor numbers, increase awareness of your company and products, or to get them interested in your product or service. Increasing visitors is useful if you cannot sell your product online; but still want to get people interested.

You should remember that increasing visitors will not directly increase your income; so you need to be very careful about overspending. You do not want to be spending £10 a click when the visitors aren’t actually buying anything!

Increase Sales

The quickest way for search engine advertising to make you money is to use it to increase sales. This is easiest if you have an online shop, where people can buy directly from you; it can also work if you have a direct order telephone number.

Remember to base your spending on the amount of money you make. If your average profit is £5 per item, you probably do not want to be paying £5 for every click your ad gets (Unless people regularly buy lots of items!).

How Much Does it Cost ?

The cost of search engine advertising depends mostly on four things: What keywords you want to advertise on – This will affect how many competitors are bidding against you, as well as how much it is sensible to bid to make the ads profitable. Of course, the more keywords you wish to advertise on, the higher your cost will be. Where you wish to appear – If you wish to appear at the top of the PPC results, it will cost you significantly more per click; it will also make you more likely to be clicked on as you will be among the first ads people see. Your Quality Score – Google Ad Words gives each of your ads a quality score, made up using your click through rate, the relevance of your ad text (If your ad talks about Computers but you sell Food it will be low relevance!), and other factors. The higher your quality score, the less you will have to pay in order to appear high up in the PPC results; whereas the lower the score, the more you will have to pay. How many people you wish to target – As you pay per click, search engine advertising allows you to start and stop as you wish. So if you have a budget of £100, you could get ten clicks at £10 each, or a hundred at £1 each, or even a thousand clicks at 10p each; depending on the above factors. Once you know the rough costs of bidding on your chosen keywords, work out a budget, and an approximate number of clicks you would like to get for that budget. Over time you will find that some keywords are more effective than others. Often you will find that keyword which cost you more per click, actually have better results. Although the cheap clicks can sometimes pay for themselves even if only a low percentage of those who click actually buy something.

Article Index

  1. How Can Your Business Benefit from Search Engine Advertising?
  2. How Much Does Search Engine Advertising Cost ? Why Use PPC ?
  3. Search Engine Advertising - How Does It Compare to Other Types of Advertising
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