Google ads is one of the best ways of advertising online. There are several different methods that might be useful for different types of businesses. For example, instead of Google ads, a lot of local businesses are finding Facebook ads more profitable because they can be better targeted. However, when your aim is to promote a business to a wider audience and get your site, along with your products and services popular, nothing beats Google ads.
You might be wondering how to advertise on Google. The simplest way is through Google Adwords. These are the ads that you see when you type in anything on Google. The sponsored links are the advertisements. They are there because they have paid Google to be there - right on the top or in the right navigational area.
If you decide to advertise with Google Adwords or Google ads, you will find that your ads will be shown on a lot of websites and not just Google. If you open a website on the internet, chances are that it uses Google Adsense for revenue. This is for webmasters who wish to monetize their websites. If you are advertising using Google ads, your ad will get to the Adsense ads of these webmasters.
There are some other types of Google ads that are becoming popular. One that I would like to mention here is Youtube. Anyone who uses Youtube frequently would know that a lot of videos now come with small 10-20 second advertisement. The full potential of Youtube ads is still untested because a lot of people find those to be annoying. Again, it all depends on what you are promoting to really know whether it will be effective. However, if you are a marketer and haven't yet tried (is it even possible?) Google ads, you certainly should.
Thursday, December 23, 2010
PPC Bidding Auctions
The process of PPC bidding is through auctions. This doesn't seem like an auction because you don't usually see people calling out their rates, but it is essentially what you are doing behind the computer screen.
Think of PPC bidding auctions like advertising in Yellow Pages - if you want a higher and better ad space, then you have to pay higher. However, the analogy ends here. In the Yellow Pages, the rate is fixed but in PPC bidding, the rate is determined through auctions.
Most PPC auctions, including Google Adwords, are second-bid or Vickrey Auctions. This means the bid is won by the higher bidder but at the second higher rate. This strategy ensures that the optimal strategy for PPC auction bidding is to bid at the exact price you think the ad is worth. Going above or below this price will be bad for you. Thus when all people bid at their optimal which is independent of what others plan, the auctioneer, Google Adwords in this case, stands to gain. Thus the Vickrey auction model is most commonly used.
Think of PPC bidding auctions like advertising in Yellow Pages - if you want a higher and better ad space, then you have to pay higher. However, the analogy ends here. In the Yellow Pages, the rate is fixed but in PPC bidding, the rate is determined through auctions.
Most PPC auctions, including Google Adwords, are second-bid or Vickrey Auctions. This means the bid is won by the higher bidder but at the second higher rate. This strategy ensures that the optimal strategy for PPC auction bidding is to bid at the exact price you think the ad is worth. Going above or below this price will be bad for you. Thus when all people bid at their optimal which is independent of what others plan, the auctioneer, Google Adwords in this case, stands to gain. Thus the Vickrey auction model is most commonly used.
Monday, December 13, 2010
Understanding Google Adwords Ranking
Google Adwords ranking system is secret and it is not revealed to advertisers. In fact, the process is quite complicated and would be very difficult to predict, even for Google. This is because PPC advertisers keep bidding on ad places at different amounts and that is not even the sole criteria of ranking.
It would be hard to break down the exact analysis of Google Adword ranking, but small advertisers need to be aware of two most important aspects that determine the ranking of your ad within Google Adsense:
Important note: The ranking depends on the maximum CPC and not the actual CPC.
The maximum CPC is what will be the maximum value of a click on your ad. Naturally, if you are able to provide a higher maximum CPC, Google or in fact any other PPC ad publisher will view it favorably. Thus if the maximum CPC is $1 for an ad, it will receive preference over another competing ad with a maximum CPC of $0.50.
There is a real danger that due to this advertisers provide a higher maximum CPC than they should. This will cause a lot of problems with the marketing campaign even though you will retain the top spots in advertising. This is a case of the famous winner's curse that I will discuss in detail in another post. Suffice for now to say that you should not go beyond your maximum CPC simply to get a higher ad spot at Google - it is not good for business. Your optimal strategy is the bid the maximum CPC that you determine for your business.
Click Through Rate (CTR)
This is another very important parameter often neglected by advertisers. Google strives hard to provide relevant ads to their customers. Therefore in a particular keyword, if you are able to catch eyeballs and make people click on your ad even though you are not at the top, Google will review this favorably. This is because it shows that your ad is more relevant to the visitors than the top placed ad, and thus Google will work to get your ad ahead.
CTR can get tricky and is hugely complex. I will provide detailed posts in the future about how to scientifically improve your CTR for the ads. The bottom line is to remember that you should make your ad attractive to the visitors. You should make your ad stand out, even in the limited space given to you. This will greatly help your Google Adwords ranking.
Review: In this post, we discussed about how PPC advertisers like Google Adwords determine their rankings. Google Adwords ranking is very important for any advertising campaign and it is primarily influenced by the maximum CPC and CTR.
It would be hard to break down the exact analysis of Google Adword ranking, but small advertisers need to be aware of two most important aspects that determine the ranking of your ad within Google Adsense:
- Maximum Cost Per Click (CPC)
- Click Through Rate (CTR)
Important note: The ranking depends on the maximum CPC and not the actual CPC.
The maximum CPC is what will be the maximum value of a click on your ad. Naturally, if you are able to provide a higher maximum CPC, Google or in fact any other PPC ad publisher will view it favorably. Thus if the maximum CPC is $1 for an ad, it will receive preference over another competing ad with a maximum CPC of $0.50.
There is a real danger that due to this advertisers provide a higher maximum CPC than they should. This will cause a lot of problems with the marketing campaign even though you will retain the top spots in advertising. This is a case of the famous winner's curse that I will discuss in detail in another post. Suffice for now to say that you should not go beyond your maximum CPC simply to get a higher ad spot at Google - it is not good for business. Your optimal strategy is the bid the maximum CPC that you determine for your business.
Click Through Rate (CTR)
This is another very important parameter often neglected by advertisers. Google strives hard to provide relevant ads to their customers. Therefore in a particular keyword, if you are able to catch eyeballs and make people click on your ad even though you are not at the top, Google will review this favorably. This is because it shows that your ad is more relevant to the visitors than the top placed ad, and thus Google will work to get your ad ahead.
CTR can get tricky and is hugely complex. I will provide detailed posts in the future about how to scientifically improve your CTR for the ads. The bottom line is to remember that you should make your ad attractive to the visitors. You should make your ad stand out, even in the limited space given to you. This will greatly help your Google Adwords ranking.
Review: In this post, we discussed about how PPC advertisers like Google Adwords determine their rankings. Google Adwords ranking is very important for any advertising campaign and it is primarily influenced by the maximum CPC and CTR.
Sunday, December 12, 2010
What is PPC Advertising?
PPC advertising, also known as Pay Per Click Advertising is an advertising model invented for internet marketing. In this model, the advertiser pays for the ad only when it is clicked. There is no charge in displaying the ad.
Google Adwords has redefined the rules of the game in PPC advertising. Google adsense is ideally suited for small businesses that do not have huge budgets to run television commercials or newspaper advertisements.
PPC advertising requires a careful understanding of this model of advertising. Since this niche is relatively new, it is hard to find optimal strategies that should be followed by advertisers. This has caused people to rely on trial and error instead of sound mathematical and economical models.
This blog hopes to bridge the gap between hearsay and solid theory so that you can use the best of both worlds to build our marketing campaign. Be sure to check out the various posts to learn all about this new advertising model.
Google Adwords has redefined the rules of the game in PPC advertising. Google adsense is ideally suited for small businesses that do not have huge budgets to run television commercials or newspaper advertisements.
PPC advertising requires a careful understanding of this model of advertising. Since this niche is relatively new, it is hard to find optimal strategies that should be followed by advertisers. This has caused people to rely on trial and error instead of sound mathematical and economical models.
This blog hopes to bridge the gap between hearsay and solid theory so that you can use the best of both worlds to build our marketing campaign. Be sure to check out the various posts to learn all about this new advertising model.
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