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Buying Search Engine Advertising

Chris Richardson
Staff Writer
Published: 2004-08-04

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Paid placement in search engines is becoming a common method of advertising for many businesses, large and small. Paid listings are different from paying for search engine inclusion because when users choose to employ paid listings, they are essentially purchasing real estate from the search engines to display their ads. Paid inclusion is paying for the guarantee that you will be listed in the search engine you gave money too.

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During the second day of the Search Engine Strategies conference, there was a session geared towards the buying of search engine advertising. This session was lead by Dana Todd, who again gave valuable information to those seeking to begin a search engine advertising campaign. Other speakers included Emily White, AdWords manager at Google and Dan Boberg, Strategic Alliances Director at Overture.

Dana began her presentation by comparing and contrasting paid listings versus organic listings. Organic listings are harder to be modified and are "subject to the whims of algorithms." Paid listings on the other hand, can be changed easily and are easy to track, Paid listing also offer instant gratification. This means you don't have to wait as long for your ad or placement to appear, whereas, organic listings can sometimes take 6 weeks to appear on SERPs.

While she spoke, Dana also discussed which search engines were considered to be a big player and those that are smaller sized. This is something to keep in mind when choosing which search engine to display your ads in.

The bigger players consisted of the obvious: Google, Yahoo, and MSN. The smaller engines were FindWhat, LookSmart, Ask Jeeves/Teoma, Shopping/e-commerce search, tech specific search (KnowledgeStorm), Yellow Pages/Local search and B2B search engines.

The interesting thing about this discussion was the revelation that B2B search engines have an 8% conversion rate for advertisements. This is much higher than the average 1-2% the other search engines offer. Dana also introduced the concept of contextual advertising. These types of ads are not restricted to search engines, with both Google and Overture have a network of partners and websites where they display their ads. The ads appear based on the context of a site's content. When buying from either company, members can select whether or not they appear on the engine's network of sites.

Admittedly, most of this information is probably old news and very basic to many of our readers. However, it's always nice to go back and touch on the basics, just in case some of us are just jumping in the business of search engine advertising.

The representatives that spoke after Dana basically reiterated what she had to say. Both Overture (Dan Boberg) and Google (Emily White) basically went over what each of their respective features offer potential members. These include the different types of matching options available; different areas in which ads can appear, including SERP placement; and what types of tools each service offers to assist you in tracking and optimization. Both Overture and Google stress the importance of the proper selection of keywords. The proper selection can and will make a significant difference in a successful search engine marketing campaign. Think of it this way, if you have the wrong keywords selected to bid on; that is, keywords that have no relevance to the services being offered, your campaign is doomed to failure, and worse, you will be throwing money away.

To learn more about what each service offers go here for Google AdWords, and here for Overture.

An interesting technique that Dana introduced was the concept of bid trapping. In AdWords, the highest ranking advertisements are based on a simple formula: Cost-per click multiplied by Click-through-rate (CPC x CTR). However, Google also employs Smart Pricing. Meaning, if your ad has the top placement and a CPC of $5, and the second position ad only bid $3.99 per click, Google will round your CPC down to $4 a click.

With bid trapping, users can change their CPC bid to 1 cent below the first position's ad CPC rate in order to lock them into their bid. The only way out of this trap is to either change their bid to 1 cent below yours, or drop the campaign altogether. This type of approach can be viewed as a shady tactic, and it will endear you to your competitors. However, bid trapping is a very good method of popping inflated CPC prices and bringing them back down to a more normal state. Messing with your comp for a common good… sounds like a winner to me.

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About the Author:
Chris Richardson is a search engine writer and editor for WebProNews. Visit WebProNews for the latest search news.

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