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Q&A: Benefits of Paid Search Marketing

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Digital marketing expert, Aydin Moghaddam, of media and marketing agency Mindshare UK, explains the business benefits of paid search marketing.

What is ‘paid search’ (PPC)?

Aydin Moghaddam (AM): “Paid search means paying to show your ad on a search engine results page. It is also known as pay-per-click or PPC marketing, because you only pay search engines when a user clicks on your ad.”

What are the main paid search options?

AM: “The main option for UK businesses is to advertise on Google, which has 89% of the UK market share, followed by Bing and Yahoo!.

How does paid search work?

AM: “Businesses can show ads on search engines by bidding on keywords related to their business. Keywords are the words and phrases that users type into search engines to find websites that match what they’re looking for.

“Every time someone searches, the search engine evaluates businesses that are bidding on that keyword. It’s not just a matter of the business that’s willing to bid the highest for a keyword that gets shown, but also other factors, such as the quality and relevance of a business’ ad and landing page. This determines which ad is shown in which order, and by which business.”

How can businesses measure their returns?

AM: “They can measure ROI by tracking what happens after a customer clicks on their ad, whether they buy a product, sign up to a newsletter, phone the business or submit an application. These are called conversions. With paid search, you can optimise to the keywords that bring the highest conversion ROI.”

What advantages does paid search have over other marketing options?

AM: “One of the benefits of PPC marketing is that, by definition, users are already searching for products and services. This is in contrast to other marketing channels, such as social media, where users are typically not using the channel with the intention of buying products and services.

“Businesses may also find it difficult and time-consuming to rank ‘naturally’ [ie by not paying] on search engines for competitive keywords. Paid search helps to shortcut that process and get fast results. Businesses can also use paid search to re-target and customise ads for existing customers or those who’ve previously visited their site. Both examples usually lead to high ROI.”

What are the likely costs?

AM: “Since paid search ads are bought in an auction, cost varies based on factors such as competition and seasonality. But small businesses should focus less on cost and more on ROI. For example, if a business pays a search engine £3 for a click to their website, but this click leads to a £300 sale, that’s a great ROI.”

What are the potential pitfalls?

AM: “Businesses can waste money showing ads for keywords that are not relevant to their products or services. To solve this, a business should add negative keywords, which prevent ads being shown for certain words or phrases. For example, if you add the word ‘free’ as a negative keyword, you’re telling the search engine to not show your ad for any searches containing the word ‘free’. This helps to reduce wasted spend.”

What advice do you offer to small firms that want to try paid search?

AM: “Have a goal in mind. Also think carefully about how much a customer is worth to you and how much you’re willing to spend to attract that customer. For example, if every customer is worth £100 to your business and you’re willing to spend £50 to acquire that customer, you’re now better placed to measure success of your paid search marketing.”

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