Should Small Businesses Get Involved With Pay-Per-Click Advertising?

These days, small business owners have many avenues they can take when they want to market their companies to people en masse, but not all such options are created equal when it comes to reaching consumers. For this reason, the costs and benefits for one of the new choices that many may be considering should be examined closely.

While many companies may now be considering options such as advertising on Facebook and Twitter, some are now being attracted to the idea of pay-per-click ads placed on various websites, according to a report from New York Newsday. Obviously the idea behind paying for this type of advertising, rather than other and more traditional online marketing methods, is that companies only have to pay the firm behind the placement when their ads are clicked, as the name implies. That might sound like a great deal, but there are many things that must be considered first.

For instance, just because someone clicks on a small business ad on a website doesn’t mean they’re guaranteed to buy anything at all, the report said. One has to consider the number of times they themselves have clicked an online ad accidentally, and immediately hit the back button or closed the new window. Owners will have to decide if the cost of that click is worth however many people may actually click the ad because they have a genuine interest in the products or services a small business provides.

Data from search marketing software company WordStream shows that smaller companies buying pay-per-click advertising generally spend about $1,200 per month on such promotion, but that about $300 of that money is wasted because the businesses don’t optimize their use of such services, the report said. For instance, more than half of involved companies only update their ads once per quarter, indicating that they’re not being as proactive as possible in trying to optimize how ads draw in potential shoppers.

How should it be done?
The first thing to keep in mind when dealing with these ads is that they’re driven by keywords, the report said. Therefore, if companies aren’t making sure they’re optimizing exactly which keywords are being used to generate their ad placement, they might not be as successful as they’d like. During this time, companies may often create a massive list of keywords to make sure their ads are seen by as many people as possible, but narrowing the focus to be as specific as possible instead is often the wise choice. This will help to ensure that only the people who are looking for the kinds of goods or services a company sells will see the ads, thereby making them more likely to click through and then buy something.

Likewise, it’s wise to keep close tabs on what are known as “negative keywords,” the report said. That means that if a business sells brown jackets, and someone searches for black jackets, they might see an ad for that company just because it listed “jackets” as a keyword. Being sure to exclude “black jackets” or other colors might, therefore, help to avoid the per-click cost of a person who isn’t interested in products offered by the small business.

“We just went through and looked at all our negative keywords,” says Elizabeth Hyer, director of marketing at Nicolock Paving Stones, a Lindenhurst, New York, manufacturer of paving stones and retaining walls. “People get bored of seeing the same ad.”

Owners worried about their advertising costs may be able to streamline other company expenses as a means of ensuring they’re keeping their bottom lines in order. For instance, reducing expenditures on small business insurance – including coverage for liability insurance – may free up thousands of company dollars annually.