Is Pay-Per-Click Advertising a Good Choice?
A beginning Internet entrepreneur should stay away from pay-per-click advertising until his or her site is doing well in the regular results of Google and Yahoo. A common mistake beginners make is to jump right into the AdWords game. When doing a search in Google and Yahoo for almost any search term, you will notice some listings on the right side of the page and sometimes in shaded regions at the top of the listings. These special ads are paid for by individual site owners wanting more exposure.
Only when a searcher clicks on the ad is the owner of the site charged. The cost varies depending upon the category. For automobile sites each click may cost several dollars or more. For a dating site the cost may only be 50 cents or less.
Again, there is only a cost involved when a searcher clicks the ad. However, unless your markup on items is substantial, it will be impossible for an inexperienced Internet marketer to make Pay-Per-Click worthwhile. It is extremely easy to get started, but the learning curve for just average success is quite high.
The Pay-Per-Click program in Google is called AdWords, and in Yahoo it is Sponsored Search. But do not spend your time or money on these yet. You must stay focused on getting your site listed well in Google's regular (organic) listings. There is nothing better than free advertising! In very few cases can any site, even those owned by experienced Internet marketers, survive with just Pay-Per-Click advertising.
And along these same lines, do not pay for any links yet either. Stay focused on developing pages Google and Yahoo will list well. Once your site is making regular sales from organic searches then you can slowly experiment with Pay-Per-Click advertising.
Read my review of Perry Marshall's AdWords book!
Beginners and AdWords
If you are new to AdWords, do not be decieved by how easy it is to get started with AdWords. Google makes the process VERY simple; anyone can be up and advertising in 20 minutes.
However, setting up an ad campaign AND making a profit are two different things!
Do some math before you begin your AdWords campaign.
A good conversion rate is 1-2%. An outstanding conversion rate is 3%
(Beginners will be very lucky to get the 1%.)
Therefore, plan on having to pay for 100 clicks and only making 1 sale. If you can do that, you are doing good. This is why beginner fail with AdWords. Say they pay $0.40 per click. Those 100 clicks will cost $40. Therefore, their profit per sale has to be more than $40 in order to make a profit.
AdWords is much tougher than most people think. Honestly, there is no way I would have figured out how to succed with PayPerClick without Perry Marshall's help. If you are brand new to AdWords, I can't suggest his Free Course highly enough.
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