I reached a tipping point with a number of paid search campaigns over the past month. More than one client has thrown in the towel at click prices that have increased 100x in the past year. This made me think more about relevancy – the old model was to cover as many keywords as possible. The new price points make that no longer feasible. At 5 cents a click you can deal with a 1% conversion rate. At $5 a click your expense has gone from $5 to $500 per lead (and that’s assuming a 1% conversion rate, which is well targeted, all those marginal ones down at 0.5% are now edging into $1000). Unless you are selling medical devices or airplanes it’s time to start looking at blogs, vertical publications, or just about anything else.
So does this mean that paid search has hit it’s peak? Unless newer customers come in with a higher threshold for pain than mine, there’s no more money to get…
3 replies on “Paid Search=3 second spot”
Great post and analysis, John. Very educational. Is pay-per-action the way around this?
[…] Will Herman sent in a comment on my post bemoaning the end of the pay per click advertising (PPC) gold rush and asked if Pay per Action will replace Pay per Click. There’s been a lot of hype in the past couple of weeks and Google recently moved in that direction by allowing PPC in their content network as opposed to pay per thousand impressions (CPM). […]
Thanks, that’s a great question that has been bouncing around in my head for a while. I thought it would be easier to do another post than a huge comment: