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What was once such a good thing is
now a rip-off and a sham!
I'm talking about pay-per-click search engines, and how
they've become a really bad investment!
There are two reasons for the deterioration of
pay-per-click search engines: high bid prices and out of
control click fraud.
A few years back, you could get popular keywords at a
halfway decent bid price. Nowadays, even moderately
popular keywords are ridiculously high.
How high? Well, let me give you an example, using the most
popular pay-per-click search engine, Overture.
Let's take the popular keyword phrase, "home
business."
At the time this article was written, Overture's top bid
for the keyword phrase "home business" was an
exorbitantly high $2.28. Just to get on the first page, it
would cost you $0.61, which would place you last at number
forty.
Now let's just delve inside the numbers for a moment,
shall we? I'm not going to even bother breaking down the
number one bid price, because quite frankly, it's obvious
the top spot is reserved for and controlled by the
high-rollers.
So, let's break down bid number forty. The bid price of
$0.61 means that for every 100 visitors Overture sends to
your website, it's going to cost you $61.00. Now, here's
where the numbers really get interesting.
According to the so-called experts, a decent conversion
ratio is right around one percent. In other words, one out
of every one hundred visitors to your website converts to
a sale. I happen to know for a fact that most websites
don't even come close to converting one percent. However,
that's a subject for another day.
Using the very generous one percent conversion ratio,
here's the problem. Unless you're selling a big-ticket
item and making $100 or more per sale, it's impossible to
make any real money with pay-per-click search engines. You
just can't do it!
For example, if you're selling a $20 e-book and you're
paying $61 to get one hundred visitors to your website,
with a one percent conversion ratio, that means your
website is making a measly $20 for every one hundred
visitors. That leaves you $41 in the hole. Even, if you
were selling a $50 product, you'd still be $11 in the
negative.
And even if you cut the bid price in half and made it
$0.30, there's still another problem. It's called click
fraud and it's a major problem among all of the
pay-per-click search engines.
In a nutshell, click fraud is what occurs when someone
fraudulently clicks on your ad over and over again,
without any intention of responding to your offer. Click
fraud hurts advertisers by driving up the cost of each
click because many online advertising programs adjust the
price of each click based on the popularity of a
particular keyword and the number of competing
advertisers.
And depending on how popular your keyword is, it can take
just a few minutes to register hundreds or even thousands
of clicks. Click fraud can quickly deplete your
pay-per-click account and leave you with nothing to show
for your expenditure.
At the present time, the pay-per-click search engines seem
to be powerless to stop click fraud. To their credit,
Google even admitted as such.
In a recent filing to the Securities and Exchange
Commission, Google acknowledged, "We are exposed to
the risk of fraudulent clicks on our ads. We have
regularly paid refunds related to fraudulent clicks and
expect to do so in the future. If we are unable to stop
this fraudulent activity, these refunds may increase. If
we find new evidence of past fraudulent clicks, we may
have to issue refunds retroactively of amounts previously
paid to our Google Network members."
In conclusion, because of unreasonably high bid prices and
rampant, out of control click fraud, I consider
pay-per-click search engines a really bad investment, and
recommend you stay away from them!
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