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How pay-per-click advertising has revolutionised the industry

There are dozens of ways to advertise online, but Google Ads is the big one. This year will see Google’s ad revenues top $100 billion, which is more than the turnover of the largest company in the aerospace sector (Boeing), the food sector (Nestlé) or the household products sector (Procter & Gamble). It’s likely to get bigger too. Recent independent research has shown that 78% of marketers plan to increase their spend on Google Ads in the future.

Text-based search advertising is still by far the most popular channel from Google, with 71% of marketers saying it’s the most effective; shopping ads and display ads are a long way behind.

It’s hardly surprising that Google has got to this position. Pay-per-click (PPC) advertising has revolutionised the industry, although it wouldn’t have surprised the publisher of the first magazine I ever edited. He was convinced that the future was in only charging for enquiries. In those days (the late eighties), enquiries meant the ‘bingo cards’ at the back of magazines which readers would fill in. “Take out an advert with our industrial magazines”, he said, “and we’ll only charge you for the name-and-address enquiries you receive from prospects.” It worked for a while, but he was driven out of business by bigger publishing houses who – in league with advertising agencies – convinced businesses that randomly flinging around money without any guarantees was the way to do things.

Print advertising still works in that random fashion today, although revenues are a fraction of what they once were. As recently as the turn of the century, it was possible for a trade magazine to charge £1500 for a full-page advertisement; an engineering components supplier recently told me he was now booking adverts for a tenth of this. Even at £150 for a page, however, he’d be happy if a few dozen people clicked through to his website to find out more. That could mean he was paying £5 or more for a website visit, whereas Google search ads undercut that substantially and, thanks to the pay-per-click model, results were guaranteed.

I don’t suppose I need to convince many of the readers of this blog of the advantages of PPC search advertising. You might be surprised how much some of your competitors are spending on it now though, and how many have put their entire advertising budget into it. Whether your advertising is managed in-house or through an agency like BMON, make sure your 2018 budget is keeping up, because as it gets more popular, the cost goes up too.