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What’s Up With Location Based Social Networking?

Location based social networking is facilitated by applications like Buzzd, Loopt, BrightKite and Foursquare, which allow mobile smart phone users to “check in” at either map coordinates or location – such as a business, restaurant, or event center. Recently, Facebook and Twitter added location options. Twitter announced in April that they will allow users to [...]

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A Beginner’s Guide to Pay Per Click (PPC) Advertising

Pay Per Click or PPC is among the most popular of all web-marketing tools. It is nothing but a small two or three line text advertisement which contains keywords and phrases. These small advertisements are usually found on the right side of search pages on leading search engines. Quite often one or two links are also highlighted on search pages. These links are termed ‘sponsored links’ and can be seen in leading search engines such as Google, MSN Live and Yahoo. These sponsored links are nothing but PPC advertisements.

The three entities involved in PPC advertising are the visitor, the host that carries the advertisement and the advertiser, who has advertised a product or service on the host website, usually a leading search engine. In this form of advertising, advertisers have to bid on keywords and phrases. Whenever someone searches a product or service using certain keywords, the search result page will feature those advertisements which contain the keywords using which the visitor actually searched in the first place.

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Why Position Bidding Wastes Money

It’s remarkable that in 2008 there are still many bidding systems in use by SEMs and in-house PPC managers dedicated to “finding the right position” for each keyword. These position crawling systems guarantee inefficiency and lost opportunity; to put it concisely: they’re playing the wrong game. Here’s why:

  1. The value of traffic doesn’t vary by position. Careful study on our part, confirmed by University Statistics researchers, has proved that the conversion rates (orders per click), average order sizes, and margin percentages do not vary by position on the page. In other words, the people who click on ads at the top of the page behave the same way on their visit as the folks who click on the same ad in the middle of the page or at the bottom of the page. The quantity of traffic is much greater at the top, but the quality is almost exactly the same. In fact, the quality in position 1 tends to be slightly lower than position 2, and the quality improves slightly as the ads get lower on the page — these are small effects that can be ignored for practical purposes.
  2. Value of traffic times the percentage of value the advertiser can afford to spend on marketing = the bid. Maximizing the top-line within some efficiency constraint — what we’re typically asked to do — is “simply” a matter of measuring the value of traffic on each ad and bidding according to the above formula. That will place the advertiser’s ad as high on the page as they can afford to be, capturing the most traffic for each ad within their efficiency needs. If that bid places an ad in position 1 — that’s great, position 6? Okay, position 15? Oh well. The position is what it is, and is determined by what your competitors choose to do at any moment.

How do position crawlers work?

Largely, trial and error through the following steps:

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Google AdWords

A business can only meet success when its products or services on sale meet their necessary marketing or advertisement. Now, when someone talks about advertising their product/service online, nothing can be more appropriate than AdWords.

AdWords was launched by Google in the year 2000 and by 2007 it was their main source of revenue. Initially an advertiser had to pay a monthly amount for advertising their product/service, but later in order to make room for small businesses and advertisers who wanted to manage their own promotion; Google launched the AdWords self-service portal. Google’s AdWords aim has been to provide the most efficient advertising to businesses irrespective of their size.

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