Paid advertising is one of the most effective and efficient methods of driving targeted traffic to your website. However, like anything else, it has its pros and cons. Paid advertising techniques are often referred to as pay-per-click (PPC), sponsored, or sponsored reviews, classified ads, or networking. These are some of the more common paid advertising techniques used today.
Advantages: One of the most obvious advantages of advertising is that it can drive up profits quickly. This is especially true in the case of ecommerce businesses. PPC services typically have a much lower turnover rate, because it takes less time for potential customers to come into contact with the businesses. Paid advertising is also easy to track, allowing the advertiser to find out what types of advertisements are performing best.
Disadvantages: Paid advertising presents some unique risks to the advertiser, especially for those who work through third-party companies. Advertisers must pay the middlemen for the use of their space and keywords. The middlemen can usually charge up to ten percent of the total profits from PPC campaigns. This means that PPC providers typically have to pass on this cost, which can cut into the profits of the advertiser and reduce overall profits.
Paid advertising offers advantages to the manufacturer as well. When a PPC campaign is run correctly, the manufacturer will be able to target its audience with great precision, since the key words will already be included in the ads. The brand name will already be familiar to many of the consumers. Because of this advantage, the manufacturer will be able to advertise directly to the consumer, whereas in other cases the advertising may travel through a series of different channels. PPC advertising also allows the manufacturer to increase the brand recognition of older ads, since they will be reaching a larger audience for the same price. In addition, PPC will often increase the profitability of new products by letting customers know more about them before they try them.
Disadvantages: Unlike direct marketing, which relies on brand recognition to gain profits, Pay-Per-Click advertising relies on consumers’ demand for the service or product. The more people click on an ad, the more people will be exposed to it, and thus potentially interested parties will click on it, lowering the cost for the ad and potentially lowering the profits. PPC services are also inherently time-consuming, making it difficult to keep up with the demands of a changing marketplace. Finally, companies may not necessarily be aware of all of the latest trends. As such, Pay-Per-Click may not be appropriate for some markets.
These are just a few of the advantages and disadvantages of PPC advertising. The benefits of PPC advertising give manufacturers an edge when competing with other brands within their industry. PPC enables manufacturers to promote their brands at a low cost and to position themselves as quality brands. As PPC continues to evolve and become an increasingly common advertising format in countries around the world, both the manufacturer and the customer stand to benefit from this dynamic change.