Paid Online Advertising: Increasing Your Company’s Profitability and Success

Chris Tomlinson January 2016

Paid Online Advertising: Increasing Your Company’s Profitability and Success by Chris Tomlinson

An Introduction to Paid Online Advertising

Advertising – it’s as essential to online businesses as it is to brick-and-mortar only shops. Whether you run an ecommerce site with no physical store, an online shop that complements your brick-and-mortar location, or you’re just looking to ramp up traffic in the offline world, you need to invest in paid online advertising.
Of course, that means you need to know a thing or two about your options here and how the various advertising methods work. In this chapter, we’ll introduce you to the various formats and what each does.
Important components of a successful online campign

Paid Online Advertising vs. Other Options

Before we get too far into our discussion of paid online advertising, we should note that these options differ greatly from other online marketing methods and should be used in conjunction with, rather than in place of them. Other marketing and advertising methods that you should utilize include:
Paid online advertising should never form the core of your efforts. However, it can provide powerful benefits when used correctly. With that being said, UK business owners are set to enjoy unprecedented levels of attention through paid online advertising.
Consider the words of the head of forecasting for one of the UK’s leading digital marketing analysis firms. “We expect to see growth of 9.7 per cent, the fastest rate since 1998. It is pretty stellar – the fastest growth rate of any mature market.
I attribute it to the healthy UK economy, marketers’ embrace of digital communication; advertisers spend more of their budgets on Internet advertising than anywhere else in the world, and strong demand for TV, which remains cheap on historical and international terms.”

The Two Camps

There are two primary types of paid online advertising – paid search advertising and display advertising. While both take place on the Internet, they’re actually very different. Here’s a quick look at each:
Paid Search Advertising: If you’ve ever searched for a topic in Google, you’ve seen paid search advertising in action. You know those first three search results at the top of your page? The ones with the little yellow and white “Ad” notification to the right? Those are paid search results.
A company has paid to have them appear when customers search for specific keywords. You’ll also see them to the right of the organic search results; any result that includes the little “Sponsored (I)” notification is a paid search result. The lower right hand column below the Google shopping images is also comprised of paid search results.
Display Advertising: Display advertising differs from paid search advertising in a couple of ways. First, these types of ads obviously aren’t shown in search engine results. Second, they tend to be “image heavy”, although they also combine text and sometimes media (audio or video). If you’ve ever clicked on a banner ad on a website, then you’re very familiar with display advertising.
Another benefit of display advertising is that these ads can be displayed to different website visitors – they’re not necessarily static and visible to all. They can be triggered by an action, a person’s preferences, search history and a great deal more. The point of these metrics is to ensure that the ad is served to those visitors most likely to find the content appealing or compelling.

CPC/PPC

The most common type of paid online advertising today is CPC, or cost-per-click. It’s also called PPC, or pay-per-click advertising. Most of the more popular platforms fall into the model, including Google’s AdWords programme. We will discuss individual platform types in a later chapter.
CPC advertising is actually very easy to understand. Essentially, you pay for each click on your ad. Let’s use a Google AdWords ad as an example.
Suppose you operated a flower shop in Cornwall. You want more orders, so you decide to start an AdWords campaign online. You choose your keywords and then bid a certain amount – this is important, as the amount you bid on the keyword(s) you’re targeting will be the amount you pay to Google every time someone clicks your ad.
You create your ad and it goes live. You start seeing traffic coming into your site, and your orders increase. Your costs also increase because each click means that you have to pay Google for the traffic.

CPM

CPM is a bit different than CPC/PPC ads. CPM stands for “cost per 1,000 impressions”. It’s used primarily for what’s called “display advertising” rather than paid search advertising. Rather than being charged for click-throughs, you’re being charged for the number of times your ad is served (seen by web surfers).
The costs involved here are very low, so you’re generally charged per 1,000 impressions (serves). Note that this method is nowhere near as popular as CPC/PPC, but it is one that should be considered.

Fixed Cost

Fixed cost advertising differs from both CPC and CPM methods. In this situation, you pay a specific amount of money to a particular website or ad network to have your advertisement displayed for a specified duration. You’re not charged for clicks or views. In a way, it’s the closest digital parallel to old-school billboard and magazine ad marketing.
Note that most fixed cost options are sold through ad networks. This gives you the means to get your ad displayed on multiple websites. You can also set different rules governing where and when your ad is shown in order to increase its effectiveness.

Google AdWords

Let’s take a closer look at Google’s AdWords programme, the most frequently used PPC platform in the world. Whether you’re a local shop or a national chain, you’ll need to make use of Google’s reach and incredible power. Despite the rise of Microsoft’s Bing website and the continued existence of other search engines, yes, Yahoo! is still around, Google remains the number one search engine on the planet by a very large margin.
AdWords is PPC marketing in its truest sense. You’ll need a Google AdWords account to get started, which is free, and you’ll need to have a good idea of what keywords you want to target. Make use of Google’s keyword research tool, which is free and only available to AdWords members.
There are quite a few benefits to be found with the AdWords platform, including the ability to choose whether your ads are served to a local audience or national or international one. This lets you tailor your marketing to your budget. Obviously, you’ll spend much more if you target a global audience than if you were strictly looking for local customers. You can even set parameters that ensure your ad is only shown to customers within a specific distance from your physical shop.
Care should be exercised when choosing your keywords, though. The more competitive the keyword, the more you’ll have to bid on it. The more you bid, the more you pay for each click. Of course, you don’t pay if there aren’t any clicks, but that’s not the goal here. You want traffic, and that’s what AdWords excels at delivering, at least in the short-term.
Note that PPC campaigns are not ideal for long-term success. However, they are excellent options for periodic use, as well as for use when you’re first getting your organic SEO efforts off the ground. When you first start your website and don’t have much content for the search engine to index, for instance.

Bing Ads

Don’t feel bad if you’ve never heard of Microsoft’s Bing Ads system. It used to be called Microsoft adCenter, and before that it was MSN adCenter. It’s very similar to Google’s AdWords platform, and works on both Bing, Microsoft’s search engine, as well as on Yahoo!’s search engine. Note that as of mid-2015, Microsoft no longer sells most of it’s ad space. That’s now the job of AOL (only a majority, though – Microsoft still sells some space).
There are many similarities between Bing Ads and AdWords, including the ability to bid on keywords and determine what audience to share the ad with. However, there are a few unique qualities worth noting with Bing Ads:
As with AdWords, you’ll want to pay close attention to the keywords you choose, the level of competition for each of those keywords, and your bid amounts, as these criteria will have a significant impact on the costs of your campaign.

Ad Retargeting

Haven’t heard of ad retargeting? Not to worry. It’s a relatively new form of recycling your advertising. While it’s been around for a few years at this point, it’s just now really beginning to come into its own. How does it work?
Ad retargeting relies on cookies – little bits of information tagged to the web browser when someone visits your website. Obviously, if cookies are turned off, this won’t work. Likewise, if a user decides to clean their cookies, retargeting won’t work either. With that being said, most people no longer pay much attention to cookies, so you can see some decent traction through remarketing.

Here’s how the process works in a nutshell:

1. A visitor lands on your website. They may browse around for a little while, or they may leave shortly afterward. In either instance, a cookie is added to their browser.
2. When that customer visits another website, your ad is displayed (thanks to the cookie).
This allows you to essentially get your ad off your own page, as well as ensure that your ads are being displayed to visitors who’ve been to your website, rather than to all and sundry. The primary benefit of retargeting is due to being able to keep your brand in front of your customers at all times. However, there are some best practices you’ll need to follow.
This allows you to essentially get your ad off your own page, as well as ensure that your ads are being displayed to visitors who’ve been to your website, rather than to all and sundry. The primary benefit of retargeting is due to being able to keep your brand in front of your customers at all times. However, there are some best practices you’ll need to follow.

Display Ads

So far, we’ve touched primarily on pay-per-click type advertising options, but now let’s take a closer look at display ads, such as banners and the like. This type of advertising has been around for a very long time, and actually predates CPC/PPC and CPM models.
Display ads can take on many different forms. They can also be positioned almost anywhere on the page. In the past, banner ads were placed primarily at the top of the page, but today they might be at the top, on the left or right, at the bottom or even smack in the centre depending on the size of the ad and the amount paid, as well as the website hosting the ad.
Think of these ads as mini-billboards. The most common format is to use text and an image, but it’s becoming increasingly common to include things like audio and video as well. Bear in mind that many consumers are averse to “auto-play” video and audio, so use these techniques at your own risk. It might build your profitability, or it could damage your brand. Many consumers consider auto-play an offensive, invasive tactic.
Note that display ad space is sold in many different ways, but cost per 1,000 impressions (CPM) is one of the most common. Fixed cost advertising is also somewhat common. CPC/PPC is less common with display advertising than it is with other formats.
While it’s possible to work with a single website to place ads on the page, most ad space is sold through various networks. Interestingly, AdWords is one of the largest networks in this space. AdWords actually combines both CPC/PPC ads and display advertising. Others include:
Note that these networks vary drastically in terms of important criteria like fill per cent, website segmentation, cross-platform operability, cost and more. What’s an ad network, really, though? Let’s take a closer look at the display ad market.
There are three “players” in the market (display advertising only). These are the publishers (the companies putting the ads up), the websites and the readers (the consumers). However, ad networks have created a fourth entry, and work as “middlemen” to bring publishers and websites together for mutual gain (and protection for publishers).
It’s in the websites’ best interest to get as much money as possible for their space. It’s in the publishers’ best interest to pay as little as possible for the space. Readers don’t get much out of the equation at all – only a very small fraction of a website’s visitors/readers constitute your target audience and will be interested in what you have to offer. To everyone else, your ad is just wasted space.
Obviously, it’s important that you’re able to target your ads to the right audience. Thankfully, there are many ways that can be done with display advertising. Here’s a quick rundown:

A Word on Mobile

No discussion of paid online marketing can be complete without at least touching on mobile. It’s the elephant in the room so to speak. Mobile has gone from a fringe option to one of the most important inclusions in any company’s marketing strategy, and you must know what it offers. For 2015:
Obviously, it’s essential that you take advantage of the burgeoning mobile market, but what advertising channels work with these devices? Actually, all of those covered thus far work, but you have to take steps to optimise for mobile. Here’s a look at the best performing channels in the mobile segment:
Obviously, mobile marketing is something that you need to account for in your strategy. That doesn’t mean you need to develop an in-house app (although that can be beneficial for some businesses). It does mean that you need to consider the partnerships you form in terms of ad networks and whether or not your ads will be shown on both desktops and mobile devices.
It also means that you need to account for mobile devices in the format, size and types of ads that you create (there’s no such thing as a one-size fits all ad when it comes to displaying on desktops and mobile devices).
Evaluation of online shopping habits in the UK

Paid Social Media Advertising

Social media marketing has become a “must have” for any business hoping to improve traction in the online world. However, there are two types of marketing here – there’s organic social media marketing, which involves engaging with your audience, posting relevant, interesting content, and more. Then there’s paid social media advertising, which is very different. We’ll break this down by some of the most popular networks to give you better insight into each platform.

Facebook

Facebook is more than just the largest social network in the world. It’s also one of the most profitable options for businesses looking to market their products or services. You have a number of options available to you in terms of paid advertising, including Facebook Ads and boosted posts. Let’s look at each in a little more detail.
Boosted Posts: When you post content to Facebook as a page, you have the option to “boost” it for a nominal fee. The amount you pay is directly related to the increased reach, the more you pay, the farther your post will reach. This can make an affordable marketing solution for high-performing posts that you want to have seen by Facebook users that aren’t already part of your audience (page fans).
Facebook Ads: In many ways, Facebook Ads is a lot like Google AdWords. They’re both keyword-oriented and can be targeted in a number of different ways. They can both include text and images, too. However, there are other things that make Facebook’s advertising solution powerful for businesses.
With Facebook’s advertising system, you can target your audience in a number of different ways. You can use gender, location, likes, interests, age, their relationship status (if they’ve listed one), where they work, their level of education and more.
Of course, the key here is to understand the overall process. Once you have your page set up, you can create an advertising campaign. This is a formal process that Facebook will walk you through. The first step is to access the Ads manager and set an objective for the campaign. You have quite a few options, ranging from boosting your posts to promoting your page to driving traffic to your website and many others.
Next up, you’ll need to choose your audience. This is where those targeting metrics we discussed above come into play. You can also create a custom audience. After determining your audience, you’ll need to determine how much you want to spend. You can set a start and end date, or you can choose to run your ad continuously. Once your budget has been exceeded, your ad will not be displayed, so bear this in mind. Note that you are charged per impression, not per click.

YouTube

YouTube is actually the second largest search engine in the world. It provides you with a very wide range of advertising opportunities. You can opt to upload videos on your own, or you can partner with YouTube and have your ads featured in the videos of other accounts. Before you do anything, though, you need to have an AdWords account (yes, Google ties YouTube to your AdWords account, which makes sense).
Next, you need to make sure that you have a YouTube account and that it’s linked to your AdWords account. You can do this through your admin panel. Once linked, you’ll need to work on your budget (daily budget). Note that you won’t be charged unless someone actually watches your ad to the end. Partial views and skips aren’t counted.
Your next step is to choose where you want your video displayed. This is a critical decision. You can opt for a number of different things, including by city, nationality, IP address and much more. Make sure that your display method matches your budget A smaller budget would be a better fit for limited viewing, and vice versa.
Now you need to upload a video and it needs to conform to YouTube’s best practices. For instance, it must be set to public, it must be either 4:3 or 16:9 aspect ratio, and it must be in a supported file format. YouTube provides the full list of formats available.
When you’ve uploaded your video, you need to choose your audience (in-depth segmentation by age, gender and other demographics), and you need to choose the keywords that apply to your ad/video. You can use Google’s free keyword tool here if you’re not sure what to target.

Twitter

Twitter is also a powerful tool for online marketing. However, it’s very different from other options out there, such as Facebook. You can’t get quite as granular in your audience segmentation, but that doesn’t mean that you should ignore this platform.
One of the most beneficial options is to make a promoted tweet. This can be done simply by visiting the Twitter advertising area and signing in. Next, create a promoted tweet campaign by answering the brief series of questions. Give your campaign a name and decide when you want it to run, and then choose your targeting method (keywords, television or interests).
If you choose the “interests” option, you can actually target the followers of other Twitter accounts, which can let you market to your competitors’ audiences. However, it’s also important to understand that the only way to get your promoted post to show up in organic searches on the network is to run your campaign with keywords.
When the campaign is complete, you can choose the tweets you want to promote (you can choose tweets as they’re made, as well, allowing you to promote content on the fly). The last step is to set your budget. Choose the option that best matches your funding and your goals. If you set a total budget, the campaign will stop once that amount has been reached.
You can also choose to promote your account. This will put your name on the list of suggested accounts to follow that Twitter gives to all users. You’ll set it up in almost the same way as you do for creating a promoted tweets campaign, except that you can target followers of other accounts. You can actually specify the accounts that you want to target.
Strategy and Implementation
Knowing the various online advertising options available to you is only half the equation. You must also utilise the right strategy, implement your online advertising campaigns correctly, track and analyse your results, and test your ads for effectiveness. In this section, we’ll touch on some of the most important elements to understand.

Common Pitfalls

Paid online advertising can be difficult, and fraught with errors and problems. Some of the most common pitfalls made by business owners and decision makers new to the field include the following:
Common paid advertising mistakes

Tracking Results

You cannot run successful paid online advertising campaigns if you don’t track the results. For instance, let’s say you create a Facebook campaign designed to get visitors to click through to your website. However, you fail to track all potential inbound routes. What happens if a visitor clicks through the link and lands on your page, but rather than emailing you or using the contact form, they decide to telephone you directly instead?
If this happens, you have no way of knowing that the call ultimately stemmed from your Facebook campaign. You must have the right tracking solutions in place. It’s really as simple as that. Failing to do so means that you’re most likely simply throwing money down the drain as you have no way to determine what efforts are successful, where your traffic is coming from, what platforms offer the most traction or anything else.
Obviously, you don’t have a limitless budget, so implement tracking solutions to make sure you’re getting not only the right ROI, but that you’re not wasting your time on platforms that don’t offer any benefits.

Conclusion

When everything is said and done, paid online advertising is a necessity. It should never form the cornerstone of your efforts, but it’s an essential element to include along with your other efforts. It can and should tie in with your organic SEO efforts (on and off-page), your organic social media marketing efforts, your content marketing efforts and more.
Of course, you need to know your options and how they work together. Is Facebook’s advertising programme better for your business than Twitter’s? What about YouTube? What about the other countless social networks out there today? There are many – LinkedIn and G+ are just two examples of other networks that may or may not be worth your time and effort.
You’ll also need to spend time ensuring that you’re able to create specific landing pages for each campaign. Ideally, someone clicking through from an AdWords ad would land on a different page than someone clicking a post on Facebook. This provides an immediate way to determine traffic volume per platform, and you can further segment that easily to ensure that you’re able to track your performance, the effectiveness of different ads and other important criteria.
It’s also important that you do not ignore the mobile sector. While your AdWords ads might show up on mobile devices, are they optimised for tablets and smartphones? Are your graphics light/small enough that they’ll load quickly without using too much bandwidth? Are you incorrectly using video ads on mobile platforms and creating negative connotations for your business?
And in a similar vein, are your ads correctly written? Are they compelling, interesting and capable of inciting interest and encouraging viewers to click through to the landing page? Writing online ads is an art form almost unto itself and it bears little resemblance to writing copy for landing pages or websites. The right copy will convince readers that you have something worth investigating. The wrong wording will make them scroll past your ad.
Finally, paid online advertising cannot be the sum of your efforts. Your marketing must extend well beyond the bounds of AdWords, Facebook Ads, YouTube marketing and the rest. Failing to use other marketing techniques (content marketing, social media marketing, etc.) will yield little traction and low ROI.
Of course, using paid online advertising platforms effectively can be difficult. You’re a business owner, not a marketing professional. You have customers to serve, orders to fill, and services to provide. It can be downright impossible to achieve everything without spreading yourself too thin. Peppersack specialises in providing business owners and decision makers with cutting-edge solutions, including paid online advertising, content marketing, and much more. We welcome you to contact us to learn more about how we can help you build your business.

Works Cited:

http://maxpoint.com/us/digital-advertising-company/onpoint-blog/2015/7/23/digital-advertising-101-the-basics-and-potential-of-digital-ads
http://digitalpublishing101.com/digital-marketing-101/digital-marketing-toolbox/part-3-email-and-online-advertising/online-advertising-basics/
https://www.reachlocal.com/uk/en/infographic/advertising-101-wide-world-online-ads-0
http://www.theguardian.com/technology/2015/sep/23/how-to-save-online-advertising
http://www.campaignlive.co.uk/article/zenithoptimedia-forecasts-uk-stellar-ad-growth-almost-10-2016/1375883
https://www.google.co.uk/adwords/?zd=1
https://retargeter.com/what-is-retargeting-and-how-does-it-work
https://www.adroll.com/getting-started/retargeting
http://www.adnetworkdirectory.com/ad_networks/?r=189®ion=United+Kingdom
http://oursocialtimes.com/uk-digital-marketing-in-2015-statistics-and-analysis/
http://blog.hootsuite.com/how-to-advertise-on-facebook/
http://www.entrepreneur.com/article/249706
https://contently.com/strategist/2015/02/10/infographic-the-beginners-guide-to-youtube-advertising/
http://www.socialmediaexaminer.com/twitter-advertising/
http://www.entrepreneur.com/article/243314
https://retargeter.com/blog/strategy-2/top-3-mistakes-made-by-online-advertisers