January 24, 2007 Comments
Patricia Hurst has an excellent piece over at Search Engine Watch today that discusses the need to craft your paid search advertisements to "pre-qualify" your clicks. With the average cost PPC cost running about $2.77 for B2B and $1.36 for B2C phrases, companies are being forced to learn how to target the best clicks rather than the most clicks.
Patricia explains:
B-to-B advertisers know that when your universe of potential buyers is limited, and when each visitor comes at a significant cost, you must ensure that the right people are clicking. They cannot be content with reaching just any curious Web surfer, but need to focus on qualified and interested customers, suppliers or partners.
This is where ad copy comes in. Many marketers have learned through experience to be very specific with their search advertising text. Using a measly 95 characters, marketers must try to explain just who should -- and who shouldn't -- click on their ad.
Some ads should be designed to reduce response. For example, one of our clients provides loans to small businesses. In order to qualify for a loan, the prospective business must accept all major credit cards and have been in operation for at least one year.
She goes on to explain that while companies are seeing strong increases in ROI by lowering traffic levels (but increasing conversion rates) that they're also running into problems with the major paid search sellers.
Current ad placement algorithms are based on some combination of maximum bid and Quality Score/Quality Index. A major factor in determining "quality" is searcher response, or CTR. So, today, the networks are rewarding popular ads, which is to say ads with the highest response rates.
That can put business owners in a tough spot.
Businesses both big and small are having to learn how to balance the value of high ROI with high cost-per-click due to positioning "penalties" being leveled against them due to their target of lower click-thrus. This can especially create problems in industries and verticals where most advertisers are still focusing on volume of traffic rather than quality.
If you haven't already read Patricia's full article, "Don't Click Here! Should You Pre-Qualify Clickers," it's worth doing so.
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