Is Pay Per Click Passe?

By now most people are familiar with the concept of pay per click (PPC). Head over to Google or Yahoo, set up an account, pick out some search terms, write copy for your ad and start running it. (OK, I'm simplifying, but you get my point.)

In fact, PPC was so much the rage at one point that many businesses cropped up to help you set up your account, create a bidding strategy, write your ads, and monitor and tweak your accounts. Heck, I even owned one such business. Notice I'm speaking about that business in the past tense.

I decided to close the doors of that particular business because small businesses placed too much emphasis on PPC programs, their budgets were insufficient, they didn't have the tools in place to leverage the increased traffic and interest, and they expected more conversions than leads. In short, there were many barriers to success.

So, is PPC passé now? Not necessarily, although there are plenty of barriers to surmount, including the myths and misapprehensions about PPC.

Myth No. 1: If You Build It, They Will Come.
At the height of the buzz, many entrepreneurs saw PPC as nothing short of a miracle. They mistakenly thought all you had to do was pay for clicks, and the clicks would come. So PPC and possibly an e-zine were the only marketing outlets they were prepared to use. When PPC failed to bring in the amount of clicks, leads and conversions they had built up in their minds, they blamed PPC for all of their marketing woes. In fact, the entrepreneurs were ultimately responsible for failing to diversify their marketing tactics.

Myth No. 2: It's Easy to Select Search Terms.
Many never took into account that they were targeting humans, and thus word selection and emphasis were critical concerns. They also didn't fully understand that other businesses would be bidding on the same or similar search terms they were, which resulted in bidding wars for many popular terms, such as "small business" or "marketing."

These bidding wars made it nearly impossible to rank highly for common search terms. Many PPC experts swear by bidding on long-tail terms such as "discount automotive spare parts" as opposed to "spare parts," but which term would you be more likely to use if you were looking for spare parts for your car?

As a result, common search terms were prohibitively expensive. Alternatively, businesses didn't have the budget to pay experts to poke around with keyword structures. Either way, small businesses couldn't afford PPC or PPC services.

Myth No. 3: All You Need is a Good Home Page.
Companies that could afford to run a decent campaign ($1,000 per month at the time, which now has escalated to $5,000-plus per month) wanted to drive all the leads to their home page. They had no one to create targeted landing pages for specific ads and split tests--and didn't realize the importance of doing so.

Customized landing pages allow people clicking on your ad to feel "at home" when they visit your site, and it lets the marketer direct visitors more precisely to the information they're seeking. If your ad mentions red plastic plates for sale, so should the page I'm directed to if I click on your ad.

As difficult as it is to get interested parties to click on your ad, it's even more of a trial to get them to buy. Many times, getting someone to buy after clicking on your ad is what's referred to as conversion--although a lead can be a type of conversion.

There are two ways of looking at conversion. PPC experts can attempt a conversion directly in the ad space by mentioning a discount, a lower price or simply posting the price of the item, or they can create a marketing funnel that takes the interested party through a series of marketing messages, each one selling products that increase in price.

The former doesn't work as often; but when it does, it results in immediate sales. The later is more time-consuming and requires a certain level of marketing infrastructure and sales messages to be truly effective. Neither is an ideal scenario for a business owner who thinks that PPC is the key that opens the floodgates to new business.

And now, with so many other time-intensive means of getting people to show interest in your products and services--such as blogs, podcasts, online communities, social networking and widgets--where should PPC fall on your company's marketing radar?

PPA is exactly what it sounds like: Marketers only pay when a predetermined action happens after someone clicks on their ad--such as buying an item or signing up to receive an e-zine or special report.

However, PPA has had some trouble gaining traction with advertisers, and Google's version of PPA has ceased sending out invites to the invitation-only beta site. The project team reportedly is taking a hard look at the future of the program.

Let's face it; industry pundits "predicted" the death of banner ads more times than can be counted. And although banner ads did evolve slightly, they're very much alive and kicking. So maybe there's hope for PPC/PPA after all.