In order to fully appreciate and comprehend Domain Name Investing, you’ll need to have a quick grasp of the concept of Pay Per Click advertising, or PPC.
Pay Per Click (PPC) is an Internet advertising model whereby an advertiser’s ads are seen on “host” sites. A host site can be:
- a search engine results page (like Google, Yahoo, DogPile),
- an advertising network (like BlogAds)
- or a content site (like a blog or a website. Like this one).
In regular advertising, advertisers pay a set fee for a certain number of copies of their ad: $1M for a billboard for a month; $500,000 for a full page ad in July’s Cosmo; $9 for a 7-line classified ad in the Sunday paper; $6M for 30 seconds during the Super Bowl half-time show.
With internet advertising, advertisers pay only when their ad is clicked. They decide how much they are willing to pay per click (PPC) and the host site rotates that ad on the world wide web accordingly. The more an advertiser will pay per click, the more frequently the ad will be seen online and/or the better the ad placement.
Setting the Price Per Click
On a search engine host, advertisers bid on keyword phrases (like “internet gambling”) relevant to their target market (gamblers). Content sites and advertising networks commonly charge a fixed price per click rather than use a bidding system.
How It Works
When a gambler searches the phrase “internet gambling” on a search engine, he gets a “search results page” displaying all the search results for that phrase. The very first links are usually highlighted and these are called “sponsored links”: meaning the advertiser paid top dollar for this great placement.
The links you see along the right side of a search results page are also sponsored (paid) links. Since this placement is not quite as good as the top of the page, this placement cost the advertiser less.
Remember: the advertiser isn’t charged unless the searcher clicks on the ad… Once the gambler clicks on a sponsored link and is whizzed away to the advertiser’s site, the advertiser is charged: cha-ching!
BTW, the other search results on the page are known as “organic” search results, meaning the website owner did not pay for the placement. They got there via other means, usually involving TIME.
When anyone clicks on a sponsored link on a content site or advertising network and is whizzed away to the advertiser’s site, only then is the advertiser charged. Often an advertiser’s ad is seen by millions of people in 24 hours, but they are only charged when someone clicks on it!
Google AdWords, Yahoo! Search Marketing, and Microsoft adCenter are the three largest PPC operators. PPC networks offer a profit sharing or affiliate agreement with website publishers (like me, like possibly one day you) to share the revenue generated by clicks originating from a website.
Here’s how you use PPC to generate revenue. First, the players:
- The Advertiser, XYZGambling.com, a website looking for gamblers
- The Gambler looking for online gambling websites
- The Domain Name Investor, like you and me, with a PPC website (or like Ultsearch who operates 50,000+ PPC websites!)
- The Search Engine that will furnish the search results for the gambler looking for a gambling website
Let us suppose the Advertiser wants to rank XYZGambling.com 1st in search results for the phrase “internet gambling”. The Advertiser goes to Google, creates an account, then bids on the term “internet gambling.” He decides he can pay up to $3.50 for each click-through to his site from a PPC ad sponsored by Google, no matter where the ad appears, be it on a search results page or a blog.
Now, here is where YOU come in. YOU have signed up as a partner – or “affiliate” as we are called in the internet business world – with Google. As a Google affiliate, you agree to show Google ads on your website. And you receive a portion of what the Advertiser pays Google each time an Advertiser’s ad shows up on your website and someone clicks on it.
Advertiser places the ad with Google
Google sends the ad to your website.
YOU provide the traffic that results in the click.
Along comes the Gambler, looking for an internet gambling site. He finds your website. He notices a link for XYZGambling.com right there prominently displayed. He clicks the link and is whizzed away to XYZGambling.com for a day of fun. Yahoo!
So: the Advertiser pays $3.50 for the click to its site. Google pays YOU a cut since the click was generated by your site. Your net take is $1.75 for one click. The revenue per click varies depending on the search term and the PPC provider. It can vary from a penny a click to over $20+ per click!
You’ve just learned the basics of PPC and how you generate revenue taking advantage of your great traffic and an advertiser’s need for visitors. We’ve only scratched the surface, but if you got this far and aren’t turned off by the new lingo and “how it’s done”… you could be one of the people making money with Domain Name Investing right now!
Learn how to choose your domain name (this is the critical item), how to set-up a simple site. Or – even simpler – where to buy inexpensive ready-to-go websites, where to look for cheap reliable web-hosting packages. If you aren’t interested in a website, learn about domain name flipping, or buying and holding a particularly good name. Check out the options upper right corner. Pick a “how to” and join us making money online!
Find out more about Pay Per Click here.