How and Why Search Engine Keyword Ads Work

Continue to Part II: Paid Keyword Ads»


Keyword advertising is a type of internet advertising in which the user bids on words that he other users search for when they type in a query in the search box. Companies like Google, Yahoo, and Microsoft's AdCenter all offer advertisers a way to pay for traffic to their sites. When a user searches for "laptop computers" the search engines are triggered to show ads related to this search alongside the results returned for the search. The ads displayed have a link to the related website and users can click on the link to go to the site. This type of advertising is the most popular online form, and lets users control exactly when their ads are triggered, how much they have to pay each month, and how much per click.


Keyword advertising can be a very efficient and low-cost way of driving traffic to your site with the right determination and due diligence. On the other hand, there are many keywords that are so popular that a budget of tens of thousands of dollars per month is needed. Keywords such as "New York City hotel" can cost advertisers several dollars per click. With a few thousand clicks per month, we can see how expensive this can become. Small and medium sized businesses won't likely be able to just throw a massive advertising budget at several keywords. They will have to be smarter and do a thorough analysis to come up with a good group of keywords that will drive significant traffic without breaking the bank. Keywords that are underperforming should be cancelled, and the money then invested in the better performers.


Unlike print media, television, and radio, internet advertising is great because it offers the quickest gratification. Ads can begin running within a day or two of being submitted to the search engines, and the traffic soon follows. Keyword advertising campaigns should be given time to work, and enough time should be allowed to gather enough data to properly analyze. At least a couple of weeks is typically needed.

Program Management Details

Advertisers using keyword advertising first need to open an account with each of the search engines in which they want their ads to appear. Some time should then be spent analyzing possible keywords, deciding on a budget, and coming up with a winning campaign strategy. After bidding on keywords, Google and the other search engines will allow the campaign to run until the set limit has been met. To increase conversion rates, it is also important to make sure that each keyword correlates well to the landing page the user will find. If you've already found a set of good keywords and your strategy is working as far as traffic is concerned, adding individual landing pages to for each keyword can help increase the conversion (sales) rate.

Continue to Part II: Paid Keyword Ads»

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