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

Search Star An Introduction to Pay Per Click 9 th 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 often 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 8 th 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 on 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 • Ad Title (25 character limit) • Ad Text (35 character limit per line) • Display URL (35 character limit)

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 The Google Network reaches over 80% of Internet Users worldwide* Content publishers, including: Google properties, Search ad partners, including: including: * Source: comScore Media Metrix (September, 2004)

Google Network: AOL Example Search query: ‘designer menswear’ Four AdWords ads under the title ‘Sponsored Links’

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

How Search PPC ROI Works • 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

Search Advertising is Far More Cost Effective Cost-per-lead across Various Direct Marketing Methods £ 0.27 Search 40% Search £ 0.45 Email £ 1.90 Banner Ads £ 9.00 Direct Mail £0.00 £2.00 £4.00 £6.00 £8.00 £10.00 Ave. acquisition CPA £10- £15 vs. the online average of £50 * U.S. Bancorp Piper Jaffray, Equity Research, June 2004

Which is why search is driving the online ad boom % Online Advertising Revenue 100% 6% Other 8% Rich Media 9% 80% Sponsorships • Marketers are voting with 17% Classifieds their ££££s. 60% • Search is now the most 20% Banners dominant form of online 40% advertising • Nearly 3x growth in since 40% 20% Search start of 2004 • 73% search penetration 0% Type of Online Media Source: Interactive Advertising Bureau, PricewaterhouseCoopers (September 2004); comScore (October 2004)

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

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 A sample AdWords ad The Destination Website

Definition: CTR Click Through Rate Impression: The appearance of your ad on Google or one of our partner sites Clicks = CTR (expressed as %) Impressions

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