Keelan Cunningham, managing director of web marketing firm Red Sky, says his company has noticed an increase in online advertising spending by Irish firms in recent times. "In terms of growth, [online] is the fastest-growing of any of the media," he says.
Within the realm of online advertising, pay-per-click listings, or paid listings, have become almost an essential tool for firms trying to pitch their goods and services to the potential market of 1 billion people who use the internet globally.
Pay per click
While most people will be familiar with the standard search results on Yahoo or Google's websites, not everyone may have noticed the paid listings - or sponsored listings - that appear at the top of the regular listings or at the side of the search results page.
To secure a place in these sponsored listings, firms need to register with the search engines, submit a selection of keywords relevant to their site, and indicate how much they are willing to spend on each keyword. This process is relatively straightforward, and both Google and Yahoo provide easy-to-use online sign-up procedures.
Your position in the sponsored listings depends on how much you are willing to pay, or bid, per keyword. For the more popular keywords, companies could find themselves bidding against competitors for the coveted top spot on the sponsored listings.
The concept behind pay-per-click is that companies only pay a fee if a consumer clicks on their listing and goes through to their website. In most cases, the amount paid (or bid) will be at least EUR0.10 per click-through but, depending on the popularity of the keyword, it could go as high as EUR10.
Firms worried about over-spending on search marketing campaigns needn't be too concerned, claims Cara Callaghan, account director with online marketing firm Digino Marketing. "The user chooses their budget so they can cap their monthly spend and not worry about costs spiralling out of control," she explains.
Making the right choice
Choosing the right keywords is sometimes regarded as a black art by companies who struggle to understand the process. The key is to think like a user who is looking for something specific, according to Cunningham. Rather than choosing general search terms - for example a garage in Sligo might think of selecting "automotive repairs" as a keyword - companies should choose more specific terms, such as "automotive repairs Sligo".
"A targeted approach to keyword selection will reap much more rewards than what we would call a 'scattergun' approach," advises Cunningham. "Users are more likely to search for very specific phrases in order to narrow down the number of results they get."
King of search
Google is the undeniable leader in the pay-per-click market; its AdWords program currently generates over USD1 billion in revenue per quarter for the firm.
"AdWords is excellent for targeting the Irish market, as Google's penetration in Ireland is very strong," according to Callaghan.
The pioneer of pay-per-click, Overture Search Services - recently re-branded under the Yahoo banner - is also popular among Irish businesses. Its pay-per-click service works in the same way as Google's, with sponsored listings appearing at the top of Yahoo search results.
Converting clicks to cash
The key to a successful pay-per-click campaign is maximising your conversion rates, says Cunningham, who adds that companies need to set realistic targets for these rates.
Conversion rates is the term used to describe user click-throughs that are converted into actual sales or registrations. This rate can be measured by firms using "conversion counters", usually provided by search engines. These counters allow you to effectively measure the return on your investment.
There are a number of things that firms can do to maximise their ROI. First and foremost, according to Cunningham, companies need to make sure their website is of a high quality, so that users are more likely to stay on the site after they click through.
"Sure, you can bring the horse to water, but you also need to see the horse drinking the water," he says. "It is an ineffective use of money if you spend a good deal on search marketing only to direct users to a poor quality website."
So-called "deep linking" is another example of how you can boost your conversion chances. With deep linking, firms match each keyword to a relevant landing page; for example, if a firm is bidding on the keyword "buy accounting software", the URL associated with that particular keyword should lead users to a webpage where they can purchase accounting software packages. This helps to ensure a seamless experience for the user and boosts your chances of making a sale.
Finally, Cunningham suggests that firms should dedicate one person to focus on the strategic web development of the company. "In such a competitive and relatively new market, there is a constant learning curve. Keeping on top of it is a full-time job."
When managed efficiently, marketing campaigns that encompass pay-per-click advertising and search engine optimisation can help firms to capture customers who are actively seeking what they are selling.