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Using Pay-Per-Click Services to Drive Traffic to Your Site

Try these budget-friendly strategies for effectively advertising your site.

Thanks to pay-per-click advertising services like Google's AdWords and Yahoo's Overture, you can now create an advertising budget and know exactly what type of return to expect. That's because by bidding on keywords that relate to your company, you only pay when a search engine user clicks on your ad--and only the amount you've specified.

After completing the free sign-up process for accounts with AdWords and Overture, you start by creating ad campaigns that are made up of four components: a text ad with a hyperlink, keywords that'll bring up your ad when searched for, a budget detailing how much you're willing to spend per keyword and your total per day.

Assembling a catchy ad for these services is relatively simple. Deciding which keywords to bid on and how much to pay for each click is a little more complicated. There's a natural tendency to go keyword-crazy at first, which can be extremely ineffective and expensive. For example, if your company sells golf balls and you bid on such keywords as "PGA Tour," "Tiger Woods" and "The Masters," your ad is going to be shown millions of times and may even get clicked on a lot--but not necessarily by potential customers. More likely, your ad is being shown to a Tiger Woods' fan who doesn't even play golf, and when they click on your ad, you've just wasted money on advertising to somebody who isn't going to buy your golf balls. So keep your keywords few and targeted.

Once you've chosen your keywords, it's time to decide how much you're willing to pay per click. If you're only willing to pay $0.05 per click, your ad may be placed under your competitors' ads and may not be shown very often. On the other hand, if you bid $2 per click, your ad might come up at the top of the results, taking a toll on your advertising budget.

Finding a happy medium is a process of trial and error. By default, AdWords and Overture will calculate how much other advertisers are paying for the keywords you're interested in and suggest a price that beats them. This price can be extremely high, but it's not necessary to have your ad placed at the very top of the results page, so don't automatically accept the suggested bid price. I recommend bidding low to begin--about $0.10 per click--and monitoring the results. If your ad gets lost under your competitor's ads and isn't being clicked on very often, you'll probably want to raise your bid.

As an example, my company sells stock footage, so the main keywords I focus on are "stock footage." Because there are a few major players in the stock footage industry, it would cost me more than $3 per click if I wanted my ad to be featured at the very top of the results page on Google or Yahoo. Since I'm unwilling to spend that much, I found a happy medium at $0.30 per click that places my ad right in the middle of the results and returns a good number of clicks.

In addition to providing statistics on how many people have visited your website as a result of your ad campaign, Google AdWords also provides conversion tracking. This means you can track how many sales have resulted as a direct result of your ad campaign, providing an excellent way to determine the return on your advertising investment. To implement the conversion tracking, you simply place a small snippet of HTML code onto your site. To do this, simply click on the Conversion Tracking page in the Campaign Summary section of your AdWords account, and follow the directions.

If you create an effective ad, bid on targeted keywords, and budget keyword clicks properly, using pay-per-click services can be a terrific way to drive instant traffic to your website.

So there are a few important things to remember:

1. Don't go keyword crazy! Choose only the keywords that'll draw the highest number of targeted visitors to your site. It's a much better strategy to have a few targeted keywords at $0.30 per click than to have 100, loosely-related keywords and pay $0.05 for each click.

2. Start by bidding low on keywords--between $0.10 to $0.20 a click. See how many clicks result from this and raise the price if you feel your ad is being lost beneath those of your competitors.

3. Set a daily budget for how much you're willing to spend, just in case the response to your ads is overwhelming. For example, three hundred clicks at $0.20 a click will cost you $6, and that may be too much for your budget to absorb.

4. Put the Google conversion tracking code onto your website to monitor how many sales are resulting from your ad campaigns.

5. Analyze and administrate. Determine the increased revenue vs. your advertising expense. If nobody's buying, it may mean your ads aren't drawing the most targeted visitors and you need to change keywords or your ad. It may also mean that clicks are bogus, coming from people such as competitors trying to break your bank. (Yes, this happens, and no, there is no way to stop them).

Joel Holland, 25, is the founder and CEO of Footage Firm in Reston, Va.

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