Decrease the Cost-Per-Click on Your Pay-Per-Click (PPC) Ads

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Decrease the Cost-Per-Click on Your Pay-Per-Click (PPC) Ads

Pay-Per-Click (PPC) marketing is a fantastic way to direct targeted, qualified traffic to specific pages on your website. Whether you are looking to increase online revenue and sales or generate more leads, PPC ads offer a fantastic platform to advertise your merchandise and services. Many websites use this advertising platform to augment their organic web presence or make up for the lack-there-of.

However, PPC campaigns offer many pitfalls and often end up costing a fortune without supplying proportional return on investment for novice campaign managers. In this article, I will discuss techniques that will help you decrease your cost-per-click and thus, increase your online profit margin.

Before I begin describing the ways in which you can lower your cost-per-click on PPC ads, I must first describe the nature of this advertising platform. Search Engines make the vast majority of their profit from companies paying to advertise through them. Therefore, the search engines view your ad as a commodity; if it is clicked they get paid, and if it does not the opportunity cost of displaying it materializes.

Keeping this prospect in mind, Google, Yahoo, and MSN attribute a "quality score" to each keyword in your PPC account. This quality score denotes people's propensity and willingness to click your ad, and will mandate how much of your maximum bid each click will cost. For example, if your maximum bid on a keyword is $3.00 but it has a low quality score, you will most likely pay close to that amount per click. On the other hand, if the keyword's quality score is high, you will be rewarded by paying much less per click. Of course factors like desired position and your competitors' bids also play a large part in this calculations, but let us focus on the idea that you will be rewarded with lower click-costs and higher ad positions if you have good quality scores.

As I mentioned in the above paragraphs, viewing search engines as businesses vested in making money is extremely important to the success of your PPC campaign. They want your ad to be clicked as often as possible. If you create an appealing and relevant ad that receives a high click-through-rate (CTR), you will be rewarded with cheaper click-costs and higher ad rankings. This is analogous to clothes in store windows: If a store uses up space on an unpopular item in its front window display, it may miss out on an opportunity to display a more popular item that will draw in more customers.

Solution Raise Your Quality Score

Even though factors like keyword use in PPC ads and landing page content play a small role in your quality score, the most important deciding factor is your keyword/ad click-through-rate (CTR).

1. Include keywords in your PPC ads

If you include the keywords that were used to trigger your ad, these keywords will be automatically highlighted by the search engine on its search results page. This will also create an immediate familiarity with the potential customer because you are using the same keyword-specific language as they do.

2. Include calls to action in your ads

Short phrases like, "buy now and save" will do your ads wonders in terms of CTR. This prospect has been shown time and time again to generate interest in customers.

3. Highlight special deals and promotions in your ads

Just like calls to action, promotional phrases like "book now and get 50% off" have been shown to fundamentally increase click-through rates.

4. Constantly test new ads

There is always room for improvement, and split A/B tests or multivariate tests will help you to quickly and efficiently weed out ads with low click-through-rates and develop new optimally performing ads.

Follow these 4 methods as rules-of-thumb when building or optimizing your website and good things will surely follow; ignore them, and you will spend countless hours scratching your head and wondering how to reduce your cost-per-click.

Copyright Olive Tree Internet Marketing, LLC. 2010

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