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Léa Noémie Plourde-Archer
Léa Noémie


What is Paid Referencing?

Having good visibility on the internet is essential for any company that wishes to prosper. Since we already covered the subject of organic referencing in a previous article, now comes the time to talk about another web strategy: paid referencing. This strategy is as important as organic referencing within the features of your web strategy. In order to learn more about it, here is a glimpse at how it works and what are its goals.

What is paid referencing?

Paid referencing, also known as Pay Per Click (PPC) or Search Engine Advertising (SEA) is an online marketing system that aims to generate traffic on a website, upon payment of a certain amount each time a user clicks on the ad that lead them to it.

Although there are other referencing platforms (such as Yahoo Sponsored Links or Microsoft AdCenter), Google Adwords is the most popular one. It is through this system that you see a list of ads appearing under the search bar on Google.

How much does a Google Adwords paid referencing campain cost?

There are three factors that need to be taken into consideration to determine the cost of paid referencing: 

  • The amount you are willing to pay per click (CPC) or per acquisition (CPA). This second option means that you will pay according to the number of contracts or clients you have obtained with respect to the number of visitors on your website;
  • Management fees: these are only applicable if you are doing business with an agency to take care of your paid referencing campaign;
  • The maximum daily budget that is allotted to your campaign. In general, a budget of somewhere between $200 and $1000 per month is recommended, although this can vary depending on the size of your company.  

Concerning the cost per click, it will vary depending on the amount of competition in your field. The more actors there are, the more you will have to pay to stand out. Therefore, Google Adwords can be seen as an online bidding system that opposes several competitors with regards to the positioning of their company in the search for a specific keyword.

Scrabble game adwords and google

Photo: Flickr

A few interesting facts about Google Adwords

Of the facts about Google Adwords that were not mentioned previously, let us first point out the possibility of testing the conversion rate of your website which is used to improve its performance. Furthermore, you will have full control over the moment when your referencing campaign is active.

On another note, you can always adjust the amount of money you will spend depending on the evolution of your campaign. Also take note that you will be able to create different types of ads to separate your referencing campaigns. Lastly, you must know that Google Adwords is able to make predictions on the degree of success of your campaign, allowing you to adjust your campaign if necessary.

To make the paid referencing campaign profitable…

Making sure that your campaign is profitable is not only about looking at the budget. It will be important to be wise about how you use the tools that Google Adwords has made available to target your audience and to gather more information about it. You could also decide that your ads will only appear for people living in certain geographical areas. Once you have this information, you could decide to target a specific display method, whether it be a computer or a mobile phone.

Your position in the ranking will first depend on the price you have paid to appear in said ranking compared to the amounts your competitors have spent. It must however be acknowledged that the process does not solely consist in choosing a keyword and paying for it to earn a good positioning within the results. Google will evaluate several elements to establish a quality score that will influence your positioning.  

As a matter of fact, your website’s relevance according to a specific keyword will be analyzed by Google, as well as the relevance of the advertisement. This advertisement must present content that has to do with the main theme of the search. Google will also take into account the number of clicks stemming from your keyword, as well as the connection between the URL (in the ad shown to the web users) and the searched keyword. The higher your score, the less you will have to pay for a favourable position within the list of sponsored links. Know that you have a quality score for each keyword.

In order to clarify the ranking process even more, it must be noted that you will see it designated under the name of AdRank. AdRank works by multiplying the maximum cost per click that you are willing to pay for a keyword with your quality score, which refers to the previously mentioned elements. Therefore, it is important that you clearly establish how these two parameters will influence your ranking. 

Tablet on stand with google homepage

Photo: Pixabay

A word on niche keywords

Since a niche keyword is very precise, it will rarely be targeted by other companies that use paid referencing. The degree of accuracy of a niche keyword also implies that a web user that uses this keyword in the search box is very interested in their search subject. Consequently, the keyword has a good conversion rate. Also, the fact that it is highly specific will help limit the competition, which will make it much less expensive.

About the statistics

It should be known that 9 web users out of 10 have used a search engine prior to completing an online purchase and that on search result pages, the first three responses attract 9 clicks out of 10. 

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