Search Star An Introduction to Pay Per Click 9 th September 2005 - - PowerPoint PPT Presentation

Search Star An Introduction to Pay Per Click

9th September 2005

About Us

• Search Star Ltd was established in July 2005 &

is based in Bath

• Experience in advertising, media & direct

marketing since 1992 & in digital media since 2000

• Specialists in digital media & search advertising
• Task based pricing with no hidden commission

Our Ethos

• Give someone a fish & you feed them for a day
• Teach them to fish you feed them for life

All consumer demographics are using the internet & search engines in increasing numbers & increasing enthusiasm

Search Engine Promotion

• With increasing consumer reliance search

engines should be the cornerstone of most web strategies

• There are 3 main components to SEP:

– Search Engine Optimisation (SEO) – Directories – Pay Per Click Advertising (PPC)

Search Engine Optimisation (SEO)

• Fundamental basis for most online presences
• Essential for long term strategy
• Website optimisation requires design for

indexing and ranking

• Imprecise control – relies on spiders for indexing
• Labour intensive – limited keywords
• Slow turn around time – results in weeks & more
• ften months

Directories

• Static listings
• Essential for long term strategy
• Paid or Free
• Can improve traditional search engine ranking
• Limited scope in terms of keyword coverage…no

lateral thinking

• Lack of flexibility

Pay Per Click (PPC)

• Performance based pricing
• Charged on a per clickthrough basis
• High control and top rankings for competitive

search terms

• Broad & lateral keyword coverage possible
• Great flexibility & fast turnaround
• 100% accountable with the right tracking in

place

What is Pay Per Click (PPC)?

• Pay per click, or PPC, is an advertising technique used on

websites, especially search engines. Pay per click advertisements are usually text ads placed near search results; when a site visitor clicks on the advertisement, the advertiser is charged a small amount. Pay per click is also sometimes known as Cost per Click (CPC).

• The most popular pay-per-click search engines are

Google Adwords and Yahoo Search Marketing, formerly Overture

• Depending on the search engine, minimum prices per

click start at £0.01 (up to £0.30). Very popular search terms can cost much more on popular engines.

Source: Wikipedia 8th Sept 05

Critics & Evangelists

Critics

• “PPC search results are not useful in finding information”

Evangelists

• “the free market is effective in bringing the best results to

the top. In theory the highest bids will be held by successful companies that are in a position to bid highly

• n their most targeted keywords”

A Media Planner’s Dream

Ads reach users at the moment they demonstrate interest

Keyword Advertising

• Targeted advertising at point of

demand - a media planners dream

• Better ROI for advertisers than other

media in most cases

• How search engines monetize their

technology & market dominance

• Why Google is valued at $44bn & is

the most valuable media company in the world

A Typical AdWords Ad

• Display URL (35 character limit)
• Ad Text (35 character limit per line)
• Ad Title (25 character limit)

Search ad partners,

including:

Google properties,

including:

Google Ad Distribution

• The Google Network consists of Google sites & partner properties that use

Google AdSense to serve AdWords ads

• These properties include: Search sites, content pages, newsletters, email

services & discussion boards

* Source: comScore Media Metrix (September, 2004)

The Google Network reaches over 80% of Internet Users worldwide*

Content publishers,

including:

Google Network: AOL Example

Four AdWords ads under the title ‘Sponsored Links’ Search query: ‘designer menswear’

Adsense Content Distribution

Google technology places your ad on the most relevant content pages

Yahoo Search Marketing

• Yahoo bought & renamed Overture in 2004
• Sales house for Yahoo, MSN, Lycos, Alta Vista,

BT, Wanadoo & Ask Jeeves

Other UK Suppliers

• MIVA (Espotting)
• Thomson Local
• Mirago

Location & Language Targeting

The Cost Benefit of PPC

• Low minimum spend
• You choose your own maximum daily spending limit (daily budget)
• Choose how much you want to spend per click for every keyword
• Pay for users who click on your ad
• Conversion tracking = real-time ROI data

** U.S. Bancorp Piper Jaffray, New Methods in Search Marketing: Contextual Advertising and Other Evolutions (Safa Rashtchy), June 2004

• Increase revenue by reinvesting profit

£1,000 initial investment in AdWords £1.00 CPC ≥ 1,000 clicks 10% conversion rate = 100 sales Average sale = £100 £1K investment returns £10K in sales Reinvest profits, increase budget

How Search PPC ROI Works

40% Search

Search Advertising is Far More Cost Effective

* U.S. Bancorp Piper Jaffray, Equity Research, June 2004

£ 1.90 £ 0.45 £ 0.27 £ 9.00

£0.00 £2.00 £4.00 £6.00 £8.00 £10.00 Direct Mail Banner Ads Email Search

Cost-per-lead across Various Direct Marketing Methods

• Ave. acquisition CPA £10- £15 vs. the online average of £50

Which is why search is driving the online ad boom

• Marketers are voting with

their ££££s.

• Search is now the most

dominant form of online advertising

• Nearly 3x growth in since

start of 2004

• 73% search penetration

Source: Interactive Advertising Bureau, PricewaterhouseCoopers (September 2004); comScore (October 2004)

% Online Advertising Revenue

40%

20% 17% 9% 8% 6%

0% 20% 40% 60% 80% 100%

Type of Online Media

Search Banners Classifieds

Sponsorships Rich Media Other

Get the variables right to maximise ROI

Search Engine Selection Keywords Matching Options Bidding strategy Geo-demographics Days & Dayparts Adtext Landing Pages The Website! Minimise Cost & Maximise ROI

Search PPC Summary

• Reach

– Access to c.80% of Internet users worldwide

• Cost

– Low costs for high ROI – Pay when users click on your ads

• Timing

– Ads are seen by users looking to purchase – Reach your audience at the right time, with the right message

• Flexibility

– Start advertising quickly – Unlimited changes, whenever you want – You can target ads to the specific location & language of your customers

A Few Definitions

Definition: CPC Cost Per Click

• Click: The action a user takes to select your ad and be taken to your

website.

• The advertiser is charged when a user clicks on their ad

The Destination Website A sample AdWords ad

Definition: CTR Click Through Rate

Impression: The appearance of your ad on Google or

• ne of our partner sites

Clicks Impressions = CTR (expressed as %)

CTR Examples

20 clicks 1000 impressions = 0.02 = 2% Example Advertiser A: CTR is how Google measures relevance 3 clicks 100 impressions = 0.03 = 3% Example Advertiser B: