In today's slowing economy, e-tailers are having to work tirelessly to get their businesses' names out in front of potential customers. Many are now experimenting with the controversial strategy of paid placement on search engines. Sounds good in theory-who wouldn't want a secure spot in the lead position in search results?-but with a few consumer groups crying foul, some entrepreneurs are wondering whether paid placement is really worth it.
of survey respondents consider pop-up ads more annoying than spam
Generally speaking, paid placement means a company pays a fee to a search engine to guarantee that links to its Web site will appear in the first few listings of relevant search results. Pioneered by GoTo.com, the strategy sidesteps the traditional way companies earn listings-by submitting their URLs and the categories they'd like to be listed in to search engines, along with a small fee.The search engines then place the listings in the directory based on unbiased standards-such as the autonomous groupings of editors or the results from software programs designed to rank related sites-with the most popular appearing first. In some cases, entrepreneurs even pay consultants to help their Web sites get higher rankings.
This objective approach is still being used, but an increasing number of companies are discovering the benefits of paying for placement. According to Danny Sullivan, editor of Search Engine Watch, an online newsletter, "Paid placement on search engines offers an incredibly easy way to gain very targeted traffic."