Why do people pay for pay-per-click advertising?

[bargainbloodhound]

Why do people pay for pay-per-click advertising? Huh, why?

I'm looking at the marketing services the eBay owned Pro Stores is offering its ecommerce clients:

With our Traffic Generation service, you are assigned a personal marketing consultant who will analyze your website to create text ads specifically designed for your business. Your consultant would then place your ads within pay-per-click sections of online search engines, manage the campaign, then track the performance.

Basic Traffic Generation
We guarantee that each month your ads will be viewed at least 10,000 times, or that you'll receive a minimum of 50 new visitors to your store.
Sign up before September 30th and we'll waive the $100 setup fee!
$100/month, Free Setup

Deluxe Traffic Generation
We guarantee that each month your ads will be viewed at least 50,000 times, or that you'll receive a minimum of 250 new visitors to your store.
Sign up before September 30th and we'll waive the $100 setup fee!
$500/month, Free Setup

OK, so Pro Stores is charging $100 monthly for 50 visitors and $500 monthly for 250 visitors.

The reason I ask "why do people pay for pay per click advertising" is because.....we have never spent one cent on any type of advertising for our site GoSearchFor.com and...well see the referrer counts for the first 19 days of this month from the google and Yahoo search engines below:

7122  http://www.google.com/search
5063  http://www.google.com.sa/search
950  http://search.yahoo.com/search
738  http://www.google.ae/search
441  http://www.google.co.il/search

umm, yeah and ProStores is charging $500 monthly for 250 visitors from Google AdWords and Overture...think I'll pass.

[xppman]

I don't get it either BBH. We tried CPC with google once about a year ago or so during the holidays. Nothing nadda, zip. Just another way for others to get into some ones pocket IMO.

Beside we were then, and are still on page one or two of most majors for FREE.
Biz is doing well and less $$$ are going to third parties. Been on the up side for quite some time now.

This is supposed to be the slow time and I'm getting great sales from my web site.

As for ebay's Pro Stores. All I can say is Unbelievable.

How many have fallen for this I wonder.

[jezebel]

Why do people pay for pay-per-click advertising?

To get visitors when they're just starting out.
They own stock in Google.
They had a vision of St. Clickalaus

[xppman]

Guote:
Out of a total of 18 million sites to choose from, the Top 500 represent less than .003% of sites. But, as you would expect, these sites get a disproportionate amount of traffic. In fact they get 45% of all traffic. No, that's not a misprint. The odds that any Web surfer in the world is on a Top 500 site at any give time is about 50/50.

Moving down the rankings, if you take Alexa's Top 100,000 sites you'll find that almost 3 out every 4 clicks are spoken for. In other words, almost 75% of all the traffic on the web goes to the sites in the Top 100K list, leaving the remaining 18 million or so sites to fight over the scraps.

End quote:
Source:
http://www.alexa.com/

I'll take my chances and list on FREE auction sites or "no upfront listing fee" types, classifieds, and yes, just a little bit on those over priced but losing momentum type sites. 

Also listing our site for FREE in major search engines is not hard at all and has helped us tremendously over the years.  So far 6 years running it has worked out GREAT and our biz / sales and traffic just keeps on going up. 

Would we get more sales if we ran say a $10,000.00 CPC ad campaign spreading it out over a years time?

Maybe.

Would we get more sales and orders than we could possible support? 

Perhaps.

If that occurs then we just did the opposite of what we are about, and we would end up with a lot of really POed customers because it took us so long to get their items built and out.
Or we would be scrambling to expand our business which could run us easily 4 to  5 times more $$$ to do so.

Many US business are running upside down today. Especially smaller to mid size ones and even one's who have been in business for 25 years or more.

It is costing MORE $$$ to make LESS $$$ in profit for so many.

At some point something has to give.

So essentially
50/50 odds are that we would just be out $10000.00 or we could see a significant increase in volume and be scrambling to expand to make maybe 20000.00 more than with out the CPC's.

That would cost us maybe 40000.00 to 60000.00 to do this with all the
regulatory restrictions involved in expanding our type of operation.

The little CPC experiment we did was to just see if all the "hype" was true about CPC ads.

It may be for others, but it just did NOT work for us and if it did we may actually be out of business today considering all the uncertainties of any given market for and given goods.

You know the whole supply and demand thing.

[xppman]

I guess I see were your coming from Vital.

I remember when I started online and went full boar. I stopped or slowed my in the field biz
which was making BIG $$$. That was decks, light construction and such.
I began to focus on online sales.

At that time I was married and like many others,
I had someone else bringing in the "bacon". My wife was working for the state and our budget was fine and that allowed me to be a stay at home dad and peruse this online endeavor.

It was easy at first not to worry about being up side down in the business end.
But I soon realized that if the business can't support itself, than what's the point of doing it.

It actually was one of the factors that put a strain on our marriage some four plus years ago.
Well six years later. I'm a single parent, my website sales business supports
both me and my son and sales have been on the rise. Strangely this is supposed to be
(and has always been traditionally), the slow period for us like many others. (Summer).

So far this summer, sales have been great and I'm hoping this a an
indicator of a heavy sales season ahead.

I guest what I'm saying is that if someone else is paying the bills,
it's fine to dabble and be upside down, but in my position, I just can't justify high fees
and paying "other services" to do what I can do for FREE on my own,
or for way less than some are paying.

To get further away from ebay has always been our goal for reasons we all know too well.
We are just about out of there and are happy to see others getting further away from ebay as well. 

[jezebel]

Out of a total of 18 million sites to choose from, the Top 500 represent less than .003% of sites. But, as you would expect, these sites get a disproportionate amount of traffic. In fact they get 45% of all traffic. No, that's not a misprint. The odds that any Web surfer in the world is on a Top 500 site at any give time is about 50/50.

How unfair.sniff, sniff,cry,cry.  :'(

[thentavius]

Woweee! The whole Pro-Stores advertising package sounds like so much internetspeak aimed at people unfamiliar with internetspeak, in an effort to get them to fork over hordes of money for a catch-all advertising "solution."

We use Google AdWords (usually less than $30 a month), and we notice that when we turn the campaigns off--our sales drop slightly. It does seem to help a bit--but I don't think that Google Adwords is right for every single business out there (and certainly should NOT be $500!).

All of the other pay per click systems seem kind of fishy and screwball to me. We tried Kanoodle (What a joke!) and Overture, and did not see any proof that they were worth paying for. Google, so far, is the only one that seems to actually do anything for us--but even then we don't always have it on, since it's not worth using all the time.

I guess eBay knows they're fooling the new "ecommerce store owners."

[bargainbloodhound]

Woweee! The whole Pro-Stores advertising package sounds like so much internetspeak aimed at people unfamiliar with internetspeak, in an effort to get them to fork over hordes of money for a catch-all advertising "solution."

That's exactly what it is... eBay is targeting people who have little to no experience with running a stand alone web site., but eBay isn't alone in taking advantage of new site owners:  the SEO and Search Engine submission companies have been ripping newly arrived people off in a similar manner for years.

[thentavius]

eBay isn't alone in taking advantage of new site owners:  the SEO and Search Engine submission companies have been ripping newly arrived people off in a similar manner for years.

That is sooooo true.

By the way, I got a fancy postcard flier in the mail a couple of days ago, pushing the new ProStores concept. It had a pricing chart in it, which told you the different costs--but not really all of the different details in each package. They also had three example stores--one for each different tier. The best looking store (at least visually) was The Frenchy Bee, using the cheapest package. LOL.

The most expensive store package example (Z Shop), was plain and looked like a basic Marketworks platform (untweaked).

I know that the visuals are supposedly only part of the package--but not everyone will equate the uglier shops to better business, if that makes any sense? The postcard seemed like a batch of vague information (i.e. a waste of money).

[Angel]

I use Google Adwords also and i've gotten some sales from it.  I keep the costs low by checking it all the time and if I think its going to high for the month I just pause it for a while.  Another thing I did was lower my ebay fees by not listing as many auctions and put some of that money into the Adwords.  I perfer getting traffic to my website instead of putting more money in ebays pockets, they get enough from me already 


Angel