Moving Beyond Pay-Per-Click Search Engines

By Jonathan Mizel
Posted Friday, September 17, 2004

A question we often receive from customers and subscribers is, "Where should I advertise my online business?"

Our first suggestion is to start with pay-per-click (PPC) search engines like Google, Overture, FindWhat, and others that sell traffic on a per-click basis. It's targeted, responsive, and best of all immediate. You only pay for actual visitors, and you can test any offer you like, from a viral or lead generating promotion, to a direct sales campaign.

Unfortunately, PPC search engines have become quite expensive, and while you can do a viability test for $100 - $200, eventually you will find yourself in a bidding war if your category is competitive. Plus, there are only so many clicks available based on the number of searches performed.

All of which brings me to a form of marketing you may not have heard of, known as "contextual" advertising.

Contextual ads have been around for a while, and in fact, if you advertise on Google AdWords and allow clicks from Content Partners, you are running such an ad. However, with Google and many others, you pay the same price per click no matter where the visitor comes from, and that can be very high (several dollars or more).

Not all contextual ads are the same. Some companies use AdWare, Spyware, toolbars, and other software to deliver unwanted, intrusive pop-ups. While the user is often targeted, they are also resentful of having their computer hijacked, making them far less likely to buy.

That's why I was excited to hear about an interesting new service called TargetBlaster.com that uses "organic" search engine traffic to generate visitors to topic-based pages in their network. The visitors then click on your specific ad. TargetBlaster.com calls this double targeting, once when they visit a themed site, and again when they click on your ad. I was skeptical, but for about the price of a PPC test, I figured I would give it a shot.

I have a client who recently released a business opportunity eBook for $29.95. I promised to help him test various traffic sources, and had performed both e-mail and PPC campaigns, so I had an idea that the promotion worked. I decided it would be my test case since I knew the sales process was strong and the offer converted.

When we promoted the eBook on Google, here's what happened:

Number of clicks: 1000
Cost per click: $0.32
Number of opt-ins: 366 (36.6%)
Number of sales: 14 (1.4%)

Total $ spent: $320
Total $ earned: $420
Total profit: $100
Total ROI: 131%

Now 131% ROI is nothing to sneeze at, especially when we have such a large opt-in rate and can remarket to prospects again and again. No spam complaints, and consistent, targeted traffic.

However, we actually do better with e-mail. We run large opt-in campaigns with commercial e-zines each week, and on an average campaign, we can expect the following:

Number of clicks: 1000
Average cost per click: $0.38
Number of opt-ins: 559 (55.9%)
Number of sales: 26 (2.6%)

Total $ spent: $380
Total $ earned: $780
Total profit: $400
Total ROI: 205%

A 205% ROI is fantastic! It means I can spend a dollar, and turn it into two in less than a week running e-zine ads! Plus notice how high both my conversion and opt-in rate is; much higher than the PPC traffic.

But as much as I love e-mail, the fact is, spam filters, bulk boxes, and the deluge of unwanted junk are driving response rates down. E-Mail driven clicks used to cost ten to fifteen cents each, and now they are approaching forty cents. Before long, e-zines will be like PPC search engines, priced out of the market!

Which leads us into a discussion of contextual ads, and specifically TargetBlaster.com. As I said, I was skeptical, but figured I'd be able to track the clicks, opt-ins, and sales, and could determine fairly quickly if there was any monkey-business like junk traffic being sent my way. Luckily, I discovered within the first day what I needed to know. Here are my final stats...

Number of clicks: 1000
Cost per click: $0.10
Number of opt-ins: 612 (61.2%)
Number of sales: 24 (2.4%)

Total $ spent: $100
Total $ earned: $720
Total profit: $620
Total ROI: 720%

I made back more than seven times my original investment of $100! That's what I call a windfall, a promotion that produces a huge profit percentage wise. The reason for the success is TargetBlaster's organic search engine traffic methods, which generate visitors who are pre-targeted before they even see your ad. People who are interested visit, request information, and most important, they buy!

I didn't test TargetBlaster with other niches, though I believe the results would be the same. The double targeting really does make a difference.

The bottom line is: We spend as much as $50,000 a month on advertising, and in most cases, the best ads are the most expensive. However, using a service like TargetBlaster, it really is possible to make money with paid advertising on a small budget. Just make sure you track your results and you'll see for yourself!

About the Author
Jonathan Mizel is currently the 8th most popular Internet marketing guru according to GuruDaq.com. He is also editor of the MarketingLetter.com, creator of the MarketingRollout.com formula, and author of the Internet's leading testing and tracking course at TestAndTrack.com. For more information, please visit: (http://www.cyberwave.com/products.html)