Pay-per-click advertising has been around for many years
now, and is the mainstay of Google’s revenues–earning the leading search
engine over $20 billion in 2008.
There’s a reason why Google AdWords has been so
successful. AdWords, the “Sponsored
Links” that appear to the right of your main search results on Google, offer
small businesses in particular a relatively low cost and flexible way to pitch
their wares and generate traffic to their Website.
This post briefly explains pay-per-click advertising based
on the Google AdWords model – how it works, discusses ways you can determine if
it’s right for your business, and offers lessons learned from other small
How does Google AdWords
Essentially, the Google AdWords pay-per-click (PPC)
advertising service allows you to create your own ads, after paying a $5
account set-up fee. The ads then run in
the “Sponsored Links” column alongside regular search results. You pay when
someone clicks your ad and gets directed to your Web site.
In addition to
charging for clicks, Google has adopted a bidding process, which lets you
allocate funds for, or “bid” on, the keywords that you want to trigger your ad
– much like bidding for an item on EBay.
The more funds you allocate to a particular batch of keywords (or in
Google language, “the higher you bid”), the more likely your ad is likely to
appear at the top of the “sponsored links” column. Learn more about the Google
AdWord pricing structure.
You can control spending by setting a spend limit per
day. But bear in mind that if you are
using a highly competitive keyword, you will quickly blow through your budget.
Once up and running, your ads will only appear when someone
searches for the specific keywords or phrases that you have selected to be
associated with your ad. Google AdWords offers a Keyword Tool
that can help you choose and assess the relevance and popularity of your chosen
keywords. The more specific and targeted your choice of keywords is to your
particular niche, the more relevance your ad will have.
Local businesses can also “geo-target” by selecting to have
ads appear only in certain metro areas, regions or countries – which can help
keep the cost-per-click low.
Do Google Adworks
Yes, but only if you use them properly. As with all marketing tactics, you will need
to monitor your metrics and make changes as you go. Keep refining your keywords
and monitor the results. Google provides performance reporting that includes
data on where your ads appeared, conversion rates, cost, and so on.
This data is your best friend because it lets you see who
your ads run up against, what searches they are appearing in, and whether you
are really getting your money’s worth from those clicks.
Are Google Adwords
Right for Your Company?
Google AdWords and other PPC advertising services are not right
for everyone. For example, if you offer a product or invention that is
relatively new to market – consider whether potential consumers would even know
to search for it?
But for most
businesses – the sky is the limit when it comes to PPC advertising and when
monitored and optimized regularly it really can complement your online
I love PPC advertising when it’s used locally. For example,
if I need to find a plumber or organic pet food store in my area – I drop my
usual cynicism about online advertising and appreciate the speed and directness
that PPC advertising offers in delivering the right result without scrolling
through pages of search results.
Lessons Learned from
If you are interested in using PPC advertising such as
Google AdWords, read Real-Life
Lessons in Using Google AdWords. This New York Times article by Darren Dahl
offers insights from small business owners about their experiences with Google
AdWords and lessons learned that have saved them money on PPC advertising
campaigns while increasing conversion rates.
Follow the Rules of
Last but not least, if you plan to advertise online –
whether you’re buying ads on search engines or direct marketing through e-mail
– you’ll need to understand some basic government rules and regulations. Business.gov explains these in its Guide
to Online Advertising Law.