Make money online by doing nothing but putting a little code on your personal website …but at what cost to your site’s credibility? For part one of this article, I’m going to give a semi-short primer in Pay Per Click (PPC) advertising. Already familiar with PPC? Go to part 2 Don’t Be Spammy – How to Use AdSense Responsibly.
PPC is an internet advertising model in which companies pay a host to display a text or visual ad. The most popular hosts are search engines. Google, Yahoo, and Bing all have networks — the Google Network is undeniably the most popular, so I’ll use that one to illustrate the concept.
Within the search engines, there are two types of PPC placements. The first being the placements which display within search results, or the Google Search Network. With this type, a company uses tools such as Google Traffic Estimator to determine the approximate bid within the network that’s needed to ensure their ad ranks in the top of the Search Engine Results Pages (SERP) when someone inputs a keyword related to the company’s website. The more popular the word, the higher the necessary bid. Let’s use “women’s shoes” as an example.
As you can see, for women’s shoes, a competitive bid would be anywhere between $1 and $1.43, per customer click-through. A competitive bid, would get a company a lot of exposure, but the budget needed would be extraordinary — between $4,000 and $8,000 per day. This company would either need a substantial search engine marketing budget, set a daily maximum within Google AdWords (Google’s ad management system), or do a little more research to find a more cost effective, yet relevant keyword.
Once the AdWords campaign is set up, any time a user types the bid upon keyword into the search engine, an instantaneous “mini-auction” takes place. The search engine compares bids based on a number of factors and then the highest bidder’s ad is displayed in a light pink box at the beginning of the search results. When there’s a tie, multiple ads may be displayed. The company is only charged if a customer actually clicks on the ad….hence, Pay Per Click.
This is all great, but not much help for us average joes.
The second type of PPC placement (the money generator for personal websites) are ads which are placed within participating websites, or the Google Display Network. Simply put, webmasters can elect to place code, free of charge, on their personal or business website which would allow the search engine to place related ads on their site – on Google this is called Google AdSense. The webmaster get a certain percentage of the amount that the company bid for the placement. The benefit for companies? The bidding price for these ad placements is substantially lower than those that show up in search results.
With Google AdSense, everyone wins: companies get to pay a lower cost per click (CPC), the webmaster gets a kickback, and the search engine gets it’s name splashed everywhere. Perfect, right?
Take a look at this ad-laden site and stay tuned for part 2…a look into how to participate in display networks without tarnishing your website’s visual appeal and credibility.