NATURAL SEO VS PAY PER CLICK
Many who are new to search advertising don’t realize that PPC (Pay Per Click) also needs to be optimized. The campaigns rely just as much on keywords as they do on at least a dozen other factors. Google AdSense spammers create multiple spam sites for the sole purpose of being paid by Google, Yahoo or Bing for getting other people to click on your embedded PPC link advertisements. Without proper PPC campaign management people in California, Maine, Florida and Ohio will see and click on links for what should have been a PPC ad for a local Tex-Mex restaurant in Texas, while others will type in “FREE” looking for a free meal at a Tex-Mex restaurant. Those who think PPC is cheaper than paying for natural SEO are wrong. Over the long run it will be more expensive. In the 2009 Las Vegas PubCon video below, Matt Cutts (in charge of web spam at Google) explains that traffic and conversions along with good content are what will count most. Google now has a “universal” search that finds blogs, videos, images so there is no more “one answer” spot number one in Google. Videos are now a very good way to go. As a matter of fact, Matt Cutts specifically says that more SEOs are now focusing on “how do I not just have a web page? How do I have a video? How do I have a blog post? things like that… We want to be able to present video from all kinds of places (not just YouTube).”
So many businesses place PPC ads and have them point to the index page of their sites. This is wrong. The SEO of today deals with not just gaining dominance in the natural rankings, but with content geared toward conversion and measurable return on investment. Tweaking and testing are the SEOs realm of expertise using analysis techniques that web coder’s are unaware of.
(The above video was produced by WebProNews.com)
Most people using PPC have no idea how much money they are actually making. Often times companies using PPC make sales and automatically assume that they are thus making money. Calculating ROI Let’s say you have one sale out of every 400 clicks. That’s 1/400th or a .025 conversion ratio. You are paying $0.30 per clickthrough. That’s $12.00 in clicks for every sale you make. Let’s assume though that your product cost is $10 and everyone out there is selling it at $20 with shipping included “free” so you make yours $20 too, shipping included. Your shipping cost is $3.00, and your transaction cost is $0.30 fixed plus 2.9% ($0.88 for the credit card transaction). Now there are the other little items like dividing up the square footage of your shop or warehouse and to determine how much rent you’re paying monthly for that stock to sit there, how much is insurance, and other factors. These fixed monthly costs can be left out of the simple equation, but at some point a spreadsheet can be built to calculate exactly how much per month PPC is actually making. So with a Pay Per Click campaign, without determining what the breakeven point is, simply making a sale isn’t any reason to celebrate when it’s costing you $12 in clicks plus $3 in shipping, plus $0.88 in transaction fees to sell a $10 item for $20. The actual fact of the matter is that it has lost the business $4.12, not including any fixed costs like floor space and insurance calculated into the equation. If the price is raised, the conversion rate will decrease further. This is not meant to be a scare tactic, but merely to make the client aware that PPC may seem like a fast and easy way to make a buck, but only on the surface. Meanwhile, calculating return on investment using PPC during optimization (and disabling contextual PPC advertising in the options) can be used as a good means to determine what keywords are receiving the highest number of clicks to help target what keywords will most likely work best toward bringing natural search traffic to the site and making the best conversions.
Most Affiliate Marketers use PPC exclusively and don’t even bother to build web sites. Those that are successful at this are often convinced that it is the optimization of PPC that is making them money when in fact the reason that the clicks on their ads are making them money is because the web pages they are sending traffic to have been well optimized with copy worded specifically to close sales quickly, and designed to funnel prospects to the right area on the page so that they can buy easily. That’s ok though, what matters is giving the searcher what he or she wants to fulfill their needs.
