Is PPC Necessary? Why? If So, When Do I Need To Do PPC?

Author: Gab Goldenberg

Is PPC necessary? Why is PPC necessary or not? If so, when do I need to do it?

These are questions I recently got in fielding a proposal for search marketing services. For others who might have the same question, here’s the answer, and an explanation.

(Related post: The Complete Guide To Brand Building Online)

PPC is necessary when you’re just entering a market.

At that point, you have no idea what keywords will or won’t convert. By buying ads on those keywords, you can tell what does and doesn’t convert. This is essential to keyword research; you can’t perform SEO that delivers a positive ROI without knowing whether you can make money with traffic from a particular keyword.

Additionally, pay per click ads is extremely valuable to compare the value of keywords before you start your SEO campaign. When you’re just entering a market, you may know that two keywords you’re targeting are commercial, but not which will deliver higher conversion rates, average order sizes, or bottom-line value per visitor. PPC can tell you that in a few weeks, whereas SEO would take several months.

Arguably, if you need to compare the relative value of keywords that you know will convert, you can skip PPC. If you’re going to make some money, and that’s enough for you, then you can go straight to SEO.

But if you want to prioritize more lucrative keywords to make the most money – which you MUST do if you’re in a competitive market – then PPC will be necessary.

Why is testing with PPC a MUST for competitive markets?

It’s a must because competitive markets are driven by ROI. Testing keywords, copy and landing paths is the way to generate a higher value per visitor.

In competitive markets, most players are using such testing to maximize their value per visitor and thus their ROI. This means that they can afford to spend more to attract those visitors in the first place.

It’s like a lemonade stand and a Ferrari dealership competing to buy ads in the local paper. Guess who’s going to get the ad inventory? The Ferrari dealership will get to buy the ad space because it makes more money from the ads, so it can spend more on the ads.

Well, what about if two Ferrari dealerships are competing to buy the same ad space? In that case, it still boils down to whoever can make the most money from the ad. It comes down to better ad design, having salesmen who close a greater percentage of sales, selling more expensive Ferraris or leases, etc.

The same thing happens online. Whoever makes more from a given piece of ad space will buy it instead of their competitors. If you content yourself with whatever ROI you can get, competitors who are more serious about maximizing their ROI will eventually price you out of the market. Over time, this means you won’t get any traffic at all.

This is equally true of SEO. If you can only afford some crummy directory submission service, and I can afford advanced link building tactics like linkbait, guess who’s going to rank first?

My backlink research (see also backlink research part 2) shows that in most commercial markets (not just the most competitive ones), you need to build links constantly – just to keep up!  Let alone surpassing others in the rankings.

Testing with PPC makes your business more efficient and grows profit margins. That means you can to spend more on link building and have a chance to succeed with SEO.

When is PPC not at all necessary?

If you’ve already worked in a market and know what keywords convert and what their relative value is, you can skip buying PPC traffic.

Well, kinda. While PPC is great for getting data on the value of a given keyword, it’s also valuable for testing ad copy and landing paths. And if you’re in a competitive market, your competitors are buying PPC traffic to maximize their value per visitor.

And furthermore, the organic search results get more competitive daily. So if you want to be able to afford the SEO services it takes to rank, you need to test with PPC.

To summarize:

  • PPC is necessary when you’re new to a market because PPC lets you test keywords out. This tells you which keywords are worth more money.
  • PPC is also valuable to maximize your value per visitor, by testing different messages and landing paths to find out what ads and versions of the website make the most money.
  • Competitive markets require PPC. Otherwise, you’ll get priced out of buying any ads or buying SEO services to get organic traffic.
  • If you already know what keywords are most valuable, you have a lesser need for PPC.
  • You probably still need it to be able to test and maximize your profitability, however.
  • Update: Josh Sciarrino, of Tampa internet marketing company Refuge Design, highlights that PPC can also be more valuable when bidding on brand, by driving additional marginal sales (be prepared for some cannibalization of your SEO-driven brand sales.

p.s. If you found this interesting, you may want to check out my buddies at Wordstream, who offer keyword research and organization software.

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Author: sroiadmin