Re: Online ad campaign on a small budget

From: David Yancey <dyancey_at_proactics.com>
Date: Wed 09 Jul 2003 08:42:57 -0500

In Online Ads of July 7th, Steve Werby asks why some are so concerned about
burning through a PPC budget quickly with Google AdWords or Overture. He
raises the great point that if one has done the homework, and knows one is
getting enough conversions from PPC leads at high-enough profit margins per
sale to cover the ad costs, then who needs to worry about running through
the budget "too quickly"?

Kudos to Steve for putting the issue in the proper economic perspective.

The problem of course is that Google and Overture essentially control where
your PPC message is displayed using an automated process. It is very easy
for such systems to experience a sudden burst of key phrase "matches",
resulting in your keyword-related ad being displayed much more frequently
for the duration of the burst. You can go to bed thinking you have enough
funds in an account for a few hundred clicks over the coming week, and wake
up to find that all have been consumed overnight.

Warning: the new "contextual placement" services like AdSense and Overtures
version will seriously compound this unpredictability, for many, if not
most advertisers.

So, Steve, the problems of spending too quickly are real, and are
compounded on a case-by-case basis by other factors:

- Many service-provider websites cannot handle dramatic peaks and valleys
in the way they respond to leads. If my PPC gets all my prospects for a
month in three or four days, I may not be able to respond in a timely
manner to the great majority of my prospects.
- Most website owners do *not* know what their true costs and operating
margins are, to begin with. This is not an accusation of failure, either:
as a consultant in the past, I have come across some very large companies
who are equally blind as to the true cost of sales.
- A great many smaller e-stores have a promotional budget that may not
exceed $50 or $100 per month. They need to manage every dollar, and the
PPC machines are not flexible enough to allow this easily.
- Web publishers who are primarily interested in acquiring opt-in email
subscriptions for a newsletter need to be constantly visible to their
prospects, since reader interest is essentially unpredictable - who can say
when the urge to become more informed about widgets or fishing or
home-brewing will strike? These sites need a *sustained* outreach
campaign, not one that causes the funds to be expended too quickly.
- Many websites are not really "commercial" at all - they are simply
hungry for traffic. With the ever-mounting obstacles of getting free
exposure in DMOZ or Google or the other crawlers, these typically smaller
sites feel compelled in some cases to buy visitors from a PPC source. For
these, it may be *much* more important to have their "message" be visible
over a longer period of time. Plus to make sure that their keyword bids do
not get out of hand.

Our new www.ProWebguide.com has been designed to give website owners some
of the missing flexibility in PPC, such as the easy ability to simply turn
a campaign on or off. We also think the smaller and lower-budget websites
need an effective place to list *without* paying for every click. But our
first product is only useful for websites aimed at webmasters and others in
our industry, so cannot help a consumer-oriented site. (We will be
introducing a consumer-focused version very soon, however - stay tuned!)

Whether the bigger, established PPCs follow our lead in time or not is
unpredictable, of course. But if they fail to develop mechanisms that are
friendlier to the smaller advertiser, I am confident that others will, in time.

David Yancey
http://www.prowebguide.com - FREE Basic listings during our Beta - - Now
with over 150,000 e-business and Internet industry website listings. Is
your site listed yet?






Received on Wed Jul 09 2003 - 08:42:57 CDT