Pay-per-click (PPC) advertising is the biggest lead-generation breakthrough to come about in a long time. For small and midsize companies, in particular—and thanks to its ability to narrowly target prospects, tightly manage spending, and precisely measure results—PPC is one of the most efficient lead generation tools ever developed.

It does, however, have a downside. Because PPC campaigns are so quick to set up and start, a business owner can easily waste thousands of dollars in a matter of weeks before learning some hard (and expensive) lessons about what works and what doesn't.

The purpose of this brief article is to point out the most common mistakes made with PPC so that your efforts begin generating results as quickly and efficiently as possible.

Mistake No. 1: Use your homepage as the landing page

When you set up a PPC ad, whether it's with Google, Yahoo or any other search engine, it's up to you to decide where to direct the people who click on your ad. By default, most companies simply send clickers to the company homepage. After all, they reason, if the homepage is the digital equivalent of the company front door, shouldn't we bring prospects there as a starting point?

No, and here's why: Most company homepages cover too many subjects and have too much going on to work as effective landing pages. Simply dropping a searcher there in the hope that he finds what he's looking for almost guarantees frustration and failure.

Remember, a person who initiates a Web search is looking for something specific. Tossing him to a generic homepage (with the implicit message, "Here, you figure it out") will work against your intention of converting ad clicks into leads.

Instead, the most effective PPC ads take clickers to a tightly focused landing page—a page specifically developed and matched to the subject of the search, with minimal distractions, a strong call to action, and a well-thought-out process for moving the searcher to the next step, whether that's requesting information, signing up for a newsletter, or making a purchase.

Fix No. 1: Always take clickers to a well-crafted landing page, distinct from the company homepage.

Mistake No. 2: Don't bid enough to secure a top spot

PPC works on an auction model, giving you, the advertiser, the option of deciding how much you want to pay for a particular search term. In effect, you can choose how high up in the ad listings you want to appear. All else being equal, the more you pay relative to other advertisers, the higher up your ad will be.

Popular search terms can have a dozen or more ads listed in order on search results pages, giving the impression that anyone can drive clicks with PPC. But consider this startling statistic: 85% of all PPC clicks are on ads in one of the top three positions. The remaining ads—whether there are five more or 50—share the scraps.

In practice, this means that unless you bid high enough to get into one of the top three spots, you're wasting your time. You're not wasting money, since if nobody clicks you pay nothing, but if you choose to be hidden further down the list, you'll have trouble generating the leads you want to close the sales you need.

Fix No. 2: Choose search terms and manage bids in such a way that you'll consistently appear in one of the top three spots.

Mistake No. 3: Don't make your ad copy specific

Yahoo allows you 190 characters (including spaces) in your text ad. Google allows just 70. No pictures, no colors, no company logo... just a few words.

Many advertisers waste this precious space with vague, meaningless terms (e.g., quality, economical, good service) or general statements that don't clearly explain the uniqueness of their offering. When that occurs, one of two things can happen—both of them bad.

The first is that searchers don't click on your ad. Again, it doesn't cost you anything, but it doesn't help you meet your objectives, either.

The second bad thing is much worse, since in this case it costs you both time and money: The wrong searchers click. In other words, your ad causes clicks, but those who click—thanks to poorly written ad copy—are not good candidates for your product or service. You pay for the clicks, but the leads go nowhere.

Fix No. 3: Be specific and unique in your ad copy. If you've got patented or otherwise unique features, a particular market or application expertise, unusually friendly return policies or warranties, or something else that sets you apart, this is the place to mention it.

Mistake No. 4: Don't align your landing page with searchers' keywords

Here's how the ideal PPC sequence should work:

A searcher goes to Google and inputs the search term red widget. Your ad pops up and the term red widget is in both its headline and in the ad copy. The searcher clicks on your ad (because you're in one of the top three spots) and arrives at a landing page that is specifically about red widgets.

No confusion, no hesitation, no wondering that maybe this isn't the right place after all. The searcher is systematically taken down a Keyword Flow path from start to finish.

The important thing to keep in mind is that Web searchers have lots of options and are presented with lots of data. Together, this leads to impatience and a tendency to abandon any search that doesn't quickly and easily lead to a desired result.

Fix No. 4: Make sure your landing pages stay focused on the key words which bring clickers there in the first place (you may have several landing pages, simply to ensure Keyword Flow). You'll increase clicks, increase conversions and as a result, increase ROI.

Mistake No. 5: Don't bother with testing

One of the things that make PPC advertising so compelling—particularly for those with limited ad dollars—is that it is instantly and perfectly testable. Unlike an ad in the newspaper, on the radio, in a trade journal, or in any of the other traditional, offline media, PPC dollars are trackable. You can not only tell which words were clicked on but also follow the click all the way through to a completed conversion (newsletter sign-up, literature request, sale, etc.).

It's critical, therefore, to constantly and continually test PPC results—tinkering with or discarding the keywords, ads, and landing pages that don't work—and making improvements along the way. You will not get everything right from the start, that's guaranteed. But thanks to the data that PPC advertising generates, you have the ability to fine-tune the process and continually improve your ROI.

Fix No. 5: Test, test, test. It's easy to do and with a bit of focused attention, you can improve your results dramatically.

* * *

PPC has a tremendous amount to offer the small and midsize business owner or marketer. Keep these five guidelines in mind as you establish your PPC campaigns, and you'll be turning clicks into profits in no time!

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John Grant is president of Take Aim Search (, a search engine marketing company specializing in pay-per-click lead generation for small and medium-sized companies.