The Problem With Pay Per Click

March 24, 2009


Actually, the title of this article should probably be The Problems With Pay Per Click for there are many problems with paying for click-through advertising.

Ad Placement
Do you know where your ads will appear?

  • Do you know what type of content your ads will appear with? If a consumer sees your name associated with inappropriate material, it may do you more harm than good. Not only won’t the potential customer click on your ad, they may also attach a negative connotation with your brand, name or image.
  • What position on the page will your ad be placed? The effectiveness of an ad often depends on its placement within the content. Sometimes it is best at the top of the page. Other times, it is best at the bottom of the page. However, most often, it is most effective when placed within relevant content. Usually, it takes a trained professional to make this critical decision.
  • Will your ad be placed along with your competitors? Having your unique ad placement gives you a competitive advantage.

Variable Pricing Vs. Fixed Pricing
In most business decisions, a known expense is preferable to a variable expense. With pay per click advertising, the variable pricing creates an unknown expense. More than one company has found out the hard way by blowing their annual marketing budget on just one month’s worth of paying for click-throughs — a fixed expense is preferable.

Click Fraud
A recent study found that over 30% of clicks on pay per click ads were fraudulent. There is an inherent conflict of interest in paying publishers based on click-throughs.

“Each time a (believed to be) valid Web user clicks on an ad, the advertiser pays the advertising network, who in turn pays the publisher a share of this money. This revenue-sharing system is seen as an incentive for click fraud.

The largest of the advertising networks, Google’s AdWords/AdSense and Yahoo! Search Marketing, act in a dual role, since they are also publishers themselves (on their search engines). According to critics, this complex relationship may create a conflict of interest. For instance, Google loses money to undetected click fraud when it pays out to the publisher, but it makes more money when it collects fees from the advertiser. Because of the spread between what Google collects and what Google pays out, click fraud directly and invisibly profits Google.”

— Wikipedia

A Consumer’s Privacy
To date, there are no known ways to track pay per click ads without violating the viewer’s privacy. Is that the image your business wants to promote — unethical business practices? At the same time consumers are becoming more educated about their privacy on the Internet, pay per click advertising networks are becoming more invasive. In the name of achieving more relevant ad delivery, the networks are increasingly tracking individual’s consumer behavior. One marketing blog recently became so upset over Google’s ever increasing privacy violations that they developed and distributed software to automatically click on all Google AdSense ads that a web browser loads.

The Right Ad Delivery
You can find companies that can deliver your advertising without any of flaws associated with pay per click ads. Some companies specialize in optimizing your ad placement at a fixed price without the risk of click fraud nor privacy violations. Do your business and your customers a favor by conducting the right advertising campaign.

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