| The placement of your ad is determined
in large part on how much you bid for
placement, with higher bids generally
getting the higher ad position on the search
results page. However, a better
pulling ad (even at a lower bid price) will
make more money for the search engine, so
the effectiveness of the ad is factored into
the ad positioning formula as well. This
means that when your ad is new, you may need
to bid a little higher for ad position, but
once your ad has proven itself, you may be
able to lower your bid and still retain good
ad placement.
Besides setting the maximum amount you
are willing to pay for each click on your
ad, you can also use the Daily Budget
feature to limit your total advertising
expenses and you can limit the amount of
time that your ad campaign will run.
The major PPC networks make it eas to
track the
efficiency of your advertising campaign.
You can track your click-thru rate (CTR -
the number of times your ad is clicked vs.
the number of times it is shown), and your
average cost per click (CPC). You can
then determine your return on investment (ROI)
based on the ratio of click-thrus to the
number of sales.
If the revenue exceeds the costs
involved with getting the customers to the
site, then the business is making money. |