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| BizBits | April 2006 |
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Is Pay-Per-Click Advertising Still Profitable? |
| Until fairly recently, I used to find it real easy to make a healthy profit from pay-per-click advertising. In fact, I never even considered any other form of advertising. It was so easy just to knock-up a simple ad, add funds to my account with a popular pay-per-click search engine, choose a bundle of popular related keywords and then sit back and wait for the sales to come in! It was that simple. To determine how much I could spend on my campaign and to calculate my maximum bid, I would use tracking software to discover the source of my sales and then simply divide the gross amount achieved by the number of visitors to my site. This basic scientific marketing produced a real healthy return on my investment. However, over time my results began to change... unfortunately for the worse! As more and more advertisers took advantage of the fast and easy access to niche markets by ppc advertising, the competition for those popular keywords to gain pole position became more fierce. Everyone wanted to be at the top to gain the most traffic. The result was a bidding war! The battle to reach the top became detrimental to the advertiser. As the bids increased, these popular terms which previously used to attract large chunks of profit became too expensive. Instead of providing a return on my investment, the campaign began to cost more than the amount that was returned in sales. I tried lowering my bids but the amount of traffic that was delivered rendered my campaign ineffective. So this was my position regarding pay-per-click advertising up to a few weeks ago. If you are an online advertiser who has used pay-per-click advertising over the last couple of years or so, then my experience will probably sound very familiar to you.. So when I released my new product I decided to 'err on the side of caution' and test my advertising campaign with a few different pay per click traffic providers before committing my budget to just one popular source. I made a comparison test between 3 different Pay Per Click Traffic sources with an investment of $200 in each campaign on my latest ebook 'Cash From Your Camera' http://www.cashfromyourcamera.com. The first was the most popular of the pay-per-click system of advertising - Google Adwords The second was another fairly popular source of pay-per-click traffic - Kanoodle at http://www.kanoodle.com. Finally, I tested a new kind of traffic source - Have Traffic at http://www.havetraffic.com. This isn't a pay-per-click search engine but it is a type of PPC advertising. They say that their traffic achieved through a network of related sites instead of a direct result from a search engine. The results... Firstly, the Google traffic was the most expensive in terms of cost-per-click for my chosen keywords. I paid on average 45 cents per visitor and received a total of 449 visitors for my $200 investment. I achieved 1 order for my product and 20 sign-ups to my newsletter providing a sign-up conversion rate of 4.4% and a return on my investment of 43% Kanoodle provided a lot more traffic for my money. I actually received 1523 visitors at around 8 cents a visitor. Unfortunately, the results were very disappointing. The campaign did not achieve a single sale and I got only 2 confirmed sign-ups to my newsletter....very disappointing! The surprise package was Have Traffic. I received 1,000 visitors for my $200 and actually received 3 sales and 46 subscribers to my newsletter. The return on my investment was a 135% plus I received 46 leads with which to follow-up Just one of the campaigns broke even and that one only earned 135% ROI. I'm sure that if I optimize everything a little better then Google and Have traffic would provide a real profitable return on my investment. Unfortunately it does appear that Kanoodle is a bust no matter what I do. Its a shame. In the distant past I could count on decent traffic from them I guess that if I had used different keywords then it may have been possible to achieve different results for the campaigns But overall, this test demonstrates that there is a still a profit to be had in pay-per-click advertising. It's just a case of looking harder and maybe further at unexpected sources for your pay per click traffic. It demonstrates to me that I need to work harder optimizing my ad copy than was necessary in the past for even those solid, well known sources of traffic like Google. |
| Robert Hartness Copyright © 2005 All rights reserved About The Author: Robert Hartness is a successful freelance photographer and writer of Cash From Your Camera, which offers a step-by-step guide to those on the threshold of freelance photography and is illustrated with 40+ published photographs. Acclaimed as a great reference source for serious freelancers. |
