The advertising industry used to be centered on charging advertisers by cost-per-impression (CPI) on TV, radio and print media. If 1,000 people saw a Tide commercial on a CBS News channel, the broadcaster would send a bill to Procter and Gamble. P&G would then assume its sales would increase.
This model has been upended by pay-per-click (PPC) advertising in digital media. The online advertising industry is growing at near 18 percent per year and represents almost $50 billion in spending by advertisers. PPC represents a very large percentage of this trend. But why?
Tide is now placing banner ads on websites, and you will also see their sponsored advertisements on Google. In digital media, the audience can simply click and connect with the brand, and the sales process begins. Research shows that 1–3 percent of the audience will click on the ad. In traditional media, connecting with the brand requires far greater effort from the viewer, once the impression has been made.
Can Tide actually measure whether a TV advertisement was effective? No, not easily or with a lot of certainty. Can they measure an online ad better? Absolutely. The systems that monitor clicks are very sophisticated and easy to use. Tide knows with granularity when, where, and how often an ad was clicked, and then what action was taken afterward. If the viewer clicked on a coupon ad, printed and then redeemed it, Tide can measure this entire process.
Tide has a billion dollar advertising budget and an enormous marketing staff. Can a start-up or sole proprietor afford to use PPC? Absolutely. The system is set up so the advertiser can either buy or bid on placement and keywords while setting a spending limit. For example, if a small automotive company can only afford $50 per day, the Google AdWords system allows the budget to be set and not surpassed. Each time a viewer clicks on the automotive advertiser’s content, $1.57 will be billed to the account. After 31 clicks, the advertiser’s content will no longer be presented that day.
PPC-based advertising has become an effective, actionable, measurable and affordable method to increase the sales of your products and services. If you would like to learn more, visit our case studies, contact us by email, or call us at 405-606-4445 for a personal consultation.
Clint Parr has lived in the digital communications industry for more than 20 years as a tech CEO, COO, marketer, salesman, consultant and entrepreneur. He currently is a Partner and CMO at liquidfish, a leading digital marketing and custom development company. He recognizes that technology can be overwhelmingly complicated, especially in the website and mobile applications industry, and someone needs to simplify it for decision makers.