Sat 3rd Mar 2007 08:05AM
The general opinion differs: some experts and practitioners point to the short term benefits of creating leads and sales through search engines such as Google, Yahoo and MSN. Others point to the mere fact that in spite of its short term appeal to create sales and leads, pay per click has either been over done and outlived its purpose, or it is about to vanish as a viable long term solution.
Generally speaking it matters what the goals are in relation to the actions that needs to be taken. For instance, we would agree that for a start up with the need to create short term sales and revenue, pay per click maybe viable. However, we are not sure if it makes sense in the long term. Yes, we know what you think - if PPC is dead, why are the majority of online businesses are doing it? Well there is a good reason: mob mentality. You will be hard pressed to find any marketing and advertising company that is willing to put their reputation on the line by suggesting that PPC should not be considered a reliable source for leads, sales or revenue. In our opinion it is just an attempt to be PC.
There are several reasons why we at World Consulting Group believe that PPC has outlived its viability: first and foremost, is the lack of transparency. It is simple: contact Google with third party fraud detection data and ask them for a refund on those clicks that you suspect to be fraudulent. The answer that you will get is most likely to be negative and justified with some non tangible reasoning. Don't get us wrong: Google is in business to make money and one should blame them for protection their "secrets". But is it really viable for a business? Can you imagine traditional businesses not wanting to disclose their methodology?
The second reason as to why PPC will not be sustainable is because of fluctuation in cost. Yes that is not that uncommon in traditional business, but with PPC the advertisers are much more susceptible to frequent fluctuation which in turn may require either extensive labor or resources devotion or coping with the unpredictable cost. Some might argue that such argument is not valid because of functions such as daily caps, budget limits, and control of pay per click overall costs, however, the actual questions should be why do advertisers that are spending their resources should have to have such limitations?
Of course there are too many other reasons including the evolution of e-commerce, new media impact, higher ISP speeds, as well as user generated content that can interfere with the viability of PPC.
In our long experience, we are virtually certain that PPC will not be able to hold its ground unless some drastic changes are made. In our opinion Pay Per Action model such as those adopted by Snap.com are much more likely to be the prevalent and the future of advertising.
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The original article is located at: Is Pay Per Click dead?