ONLINE MARKETING - Australia

Google is testing a new advertising system that allows businesses to advertise on a cost per action basis. You can read Google’s own announcement here.

Until recently, Google has mostly sold pay-per-click (PPC) ads, under its AdWords program - advertisers pay when someone on Google or a Google partner site clicks on the ad. Google have also offered for quite some time a Pay per Impression (PCM) model for Site Targeted Ads.

Google AdWords PPC has one big advantage and one big disadvantage: You only pay for clicks of potential customers, but you also risk paying money for nothing (sometimes a lot) because of click fraud.

There has been a lot of debate around click fraud because Google has a short term financial incentive to promote it. Google’s new advertising product is “pay per action” (PPA). With PPA you don’t pay per click anymore but you pay when a customer takes further action, such as buying a product or signing up for a newsletter - a Conversion action that you can define.

How can Google track the action?

If you use Google’s PPA advertising product, then you must use Google’s conversion tracking code in the HTML code of your web pages. By placing the relevant tracking code on your Conversion page (generally a confirmation type page which is displayed once a conversion has been achieved), Google is able to flag the “Action” and trigger a charge.

Of course, the advertiser has an incentive not to confirm the action, but cheating does not make sense. Like PPC ads, PPA ads will likely be ranked by profitability to Google, so if you ads not generating any actions, then it will probably stop being displayed in the first place.

Adwords PPA Ads will be competing directly with existing PPC and PCM advertisers, (all these types of ads will co-exist on the Google Content Network) so it will be interesting to see how Google goes about determining which Ads to display, and what impact this has on bid prices. Google will almost certainly choose Ads which offer them the greater profit.

What are the consequences for the market?
Google will be able to better maximize revenues on its advertising network, and it also should allay the concerns over click fraud.

Google’s new PPA program is in direct competition to affiliate marketing networks such as Commission Junction and LinkShare. Publishers could leave those affiliate marketing networks and concentrate on Google’s PPA program.

Yahoo and Microsoft may very well offer similar PPA programs in the future. The current players on the PPA market Snap and Turn now face heavy competition.

What are the consequences for you as an advertiser?
If you already track the return on investment (ROI) on your PPC ads, then you won’t be affected much.

If you are a smaller advertiser, then PPA advertising could mean that you will pay less for better results in the future, and that you will never worry about click fraud again.

Note that Google’s pay per action program is currently in beta test. This means that there are some limitations:

* participation is by invitation only, you must fill out a web form to request participating in the program
* the PPA program is currently only available to US customers
* ads are limited to Google’s content network of partner sites (Google AdSense)

This post outlines some of the basic steps in setting up a PPC campaign.

• The first step in putting together a PPC campaign is to decide your budget and what level of risk you are willing to take, for both will affect which PPC search engine you ultimately choose.
• Choose a Search Engine - As one would expect, the larger search engines such as Google and Yahoo may be less risky, since they already have excellent market coverage and tend to offer a lot of assistance to their users, but they also are often the most expensive in terms of the cost to acquire a top ranking based on a specific keyword or group of keywords.

  There are plenty of free, independent tools available to help you in your research of keywords which will tell you the current bid price for certain words or phrases on the different PPC search engines.

• Once you have decided upon which PPC search engine you are going to use, have put together you ad, and decided the keywords you wish to have your ad appear under, register with the search engine, fill out the necessary information to open an account, and then begin the bidding process for the keywords you have decided upon.
• When you first register your keywords with the search engine you have chosen (and some large businesses may use thousands of keywords), you will also specify the maximum amount you are willing to bid for those keywords. The price of a keyword can range anywhere from 1 cent to $10 or more, depending upon its popularity as a search term and the search engine itself.

Pay-per-click (PPC) is a type of marketing service offered by a variety of search engines. PPC typically involves the placement of an “ad” on the search results page for a specific keyword or keywords in return for a payment when a visitor clicks on that ad. The advertiser pays nothing to appear on the results page; they only pay the amount they have agreed to (or bid for) when someone actually clicks on their ad and is taken to their landing page; therefore, the term “pay per click”.

A PPC listing on a search engine results page typically consists of a title (around 50 characters maximum) and also a short (usually no more than 200 characters long) description of your service or some promotional wording. Some PPC search engines strictly control the text that can appear in the listing, while others are more open to using the advertiser’s own text.

Google announced plans to begin a test of PPC-based ads using the site targeting feature.

Site targeting allows advertisers to choose individual sites in the content network where they want their ads to appear. Since it launched nearly two years ago, the program has used bids placed on a cost-per-thousand impressions (CPM) basis. That will begin to change in March, when a limited set of U.S. advertisers will have the option of paying on a cost-per-click (CPC) basis.

Google expects the CPC pricing to appeal to conversion-oriented, direct response advertisers who are focused on clicks, and track metrics such as sales, leads or sign-ups. That may get more advertisers interested in the tool, since many have tried site targeting on a CPM basis and found it lacking in ROI. Site targeting is popular with advertisers as a branding buy, when they want to get in front of the readers of a given site.

We are VERY pleased to announce the launch of the New ONLINE MARKETING Australia website & Blog.

ONLINE MARKETING Australia provides a range of service to business owners - covering the online promotion and marketing of their business. These services include (but are not limited to) :

• Pay Per Click Advertising
• Paid Inclusion
• Email marketing
• Banner Ads
• Online Press Releases
• Affiliate Marketing
• Interative Advertising
• Social Marketing
• Viral Marketing