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Pay For Placement: Keyword Bidding

By bidding for certain keywords, you can improve your search results.
January 26, 2001
URL: http://www.entrepreneur.com/article/36486

In yesterday's tip, Alison Berke, president of bworks.com, introduced us to the concept of keyword buying. Now let's hear from her about keyword bidding.

"Another way to buy positioning on search engines is through "keyword bidding" at GoTo.com. GoTo lets users bid on the keywords they'd like to be listed under, and the highest bidder is listed first. Then when someone types your search term into the search box, you'll be listed first on the results page. You can dictate the exact description you'd like listed for your Web site.

"In terms of cost, you only pay your bid price if someone actually 'clicks' on your Web site and visits it. The real payoff for GoTo.com is that their results are being incorporated into so many other search engines. As with the Real Names strategy, Goto.com results are featured on many different search engines, like Netscape, AOL, HotBot, Lycos and Alta Vista. Each search engine has a different way of featuring GoTo listings, and several of them use the GoTo results as their first three results on a search. Therefore, it's smart to pay to be in the top 3 listings.

"GoTo.com keywords can cost anywhere from .01 - $5.00 or more per click. GoTo also gives detailed reports on how your bids are doing and how many clicks you're getting per keyword on a daily basis."

Berke does have a caveat when doing keyword bidding: "Make sure you aren't bidding more on a search term than it's actually worth. If you get into a bidding war with another Web site, it may not be a good investment to pay $5 per click if you're not going to get at least $5 from each potential customer. For example, you may get 50 clickthroughs from a $5 listing-which translates to $250 but only one or two people may give you business-are you going to make at least $250 from the transactions?"

Aliza Sherman is an entrepreneur and author of Cybergrrl: A Woman's Guide to the World Wide Web (Ballantine Books). She is currently working on her next book and new company.