Friday, April 28, 2006

Targeted Marketing: Pay-Per-Click Introduction

I spoke about it briefly yesterday, but one of the most important mechanisms of the internet for successful affiliate marketing is based around targeted marketing and pay-per-click (PPC) programs. Let me explain how this works...

I am sure you have all used a search engine before and have noticed "sponsored" links listed somewhere on the page. Google, for example, has sponsors on the right column and sometimes, has 1,2 or 3 sponsors above the search results (which are highlighted). These sponsored links appear on mostly all search engines: Yahoo, Hotbot, MSN, etc. Similarly, you will find sponsors located on individual webpages. This blog, for example, has a list of sponsored links at the bottom of the right column. These specific type of ads are called "content ads". We will discuss this another day. They work in the same manner, though.

First of all, anyone can create an ad for any website at any time. To set up an account usually costs less than $5 and there are no commitments or monthly fees to join (if you are, you are doing something wrong!). The special thing about all of these ads are that you ONLY pay what people click on! My ad can be seen by 1,000,000 people (these are called "impressions"), and receive zero clicks, and this will cost me nothing. Most ads cost anywhere between 5 cents per click to $5 per click to hundreds of dollars per click (I have never seen this type, but have read about them). So, let's say that 1000 people see my ad today and 100 of them click my ad at $0.1/click. My costs for the day would be $10. Luckily, most PPC programs allow you to limit your daily budget, just in case your clicks exceed your expectations.

The other main thing to point about about pay-per-click programs is that you are bidding on keywords: these are the words that people are searching for. For example, if I am selling golf clubs, I may bid on keywords such as "golf", "golf clubs", "how to play golf", "pebble beach", etc. You would probably not be bidding on keywords such as "britney spears", "baby showers" and "asian monkeys". The significance of this is that we are now targeting our product and website to those who are actually looking for it. Target marketing is a huge component to making affiliate marketing campaigns work!

Unfortunately, running pay-per-click campaigns are not trivial. PPC are strongly based on:

1) Competition,

2) Writing good ads,

3) Relevance

and, of course,

4) MONEY!!

More to come on Sunday! And remember, you CAN make money doing this! Be sure to check out the eBooks that have worked for me at my review site to get your campaign started today!: