The Cost of Pay Per Click Search Engine Marketing

Pay Per Click Alternative

The Pay Per Click Reality

Overview, What is Pay Per Click Advertising?
Pay Per Click Management Services
Limiting Your Market: What You Don't Know About
Search Patterns
Pay Per Click Bid Management Software
Pay Per Click Cost
Pay Per Click ROI Report
PPC Click Through Rates
Click Fraud

The Cost of Pay Per Click Search Engine Marketing

Pay Per Click (PPC) search engine marketing is a billion dollar industry that shows no sign of slowing down even if studies do show that organic search engine optimization by a professional search engine marketing and custom website design company like Dynamic Digital Advertising (DDA) holds the potential to drive more traffic to a website. In 2005, $4.7 billion was spent on PPC online advertising programs, that's 81% of the total $5.75 billion spent on search engine marketing¹. Even though advertisers' are spending that much money, 4 out of 5 search engine users still report never clicking on paid search listings².

Cost of Keywords
Keyword costs rise significantly each year. In 2005, keyword prices increased 43.7% from 2004³. However, advertiser's end up spending so much on acquiring keywords that their Return on Investment (ROI) rarely exceeds the cost. In fact, one survey revealed that 57% of respondents reported they felt the keywords and keyword phrases they wanted were "too expensive" and 51 percent revealed they fear they pay too much on keyword bids⁴. During the holidays, cost of keywords increases 100%⁵.

Cost Per Click
Major search engines like Google, Yahoo! or MSN start their pricing at $.05 per click but the average cost for a top keyword exceeds $3.30 per click and some top keywords cost the advertiser more than $150.00 per click through. The costs are actually higher when an advertiser considers that 15-30% of all click throughs are fraudulent. It is apparent that a lot of money can be wasted by investing in a PPC online advertising program.

Is It Worth The Cost?
If 80% of search engine users report never clicking on paid search listings1, it means advertisers are spending billions of dollars advertising sites that are never being viewed. Also the overall conversion rate of paid sites is 3 times less than that of unpaid sites2. Paid search also sometimes requires additional cost for PPC management services or automated bid management software. Considering these facts the answer seems clear: often Pay Per Click search engine marketing is not worth the cost. Advertiser's are generally much better off investing in an organic search engine optimization strategy by a professional website promotion and custom website design company like DDA.

¹ SEMPO "The State of Search Engine Marketing 2005"
² The iProspect Search Engine User Behavior Study, April 2006
³ iProspect
⁴ JupiterMedia 2003
⁵ Ibid

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