The idea of how a search takes place appears quite simple. A searcher visits one of the many online search engines, enters a search term and receives his or her results. And understanding that there are only three types of searchers makes it even easier, those looking for entertainment, information or to make a purchase.
With Google’s pay-per-click model we can pick and choose the words we want to bid on. And not only do you only pay if someone does a search for that keyword and your ad shows up, but you only pay if they click on the ad.
This guarantees that not only was our ad seen but it was clicked on and the end user landed on our website. This is a performance-based advertising model.
Now…if that wasn’t enough to get people lining up at the door Google took it a step further. They created a way that anyone could sign up and immediately start adding keywords into their account and get their ads showing online. There is no salesperson between the advertiser and the inventory.
With a self-serve model there are no contracts to sign, commission to pay, phone calls to make or any of the other stuff that would normally go on between a business and its clients.
Could It Get Any Better?
Of course it could!
Google took it a step further with an auction type bidding process were the advertiser could bid on how much they were willing to pay for that potential client. The company willing to pay the most would then show up the highest.
So…what we had were four simple concepts: relevance, pay-per-click pricing, self-service, and auction-based pricing.
In February of 2002 Google took it a step further with the launch of AdWords and the click-through rates (CTR) formula to determine ad position. The idea is that the more an ad is clicked the more relevant that ad is with what the searcher is looking for. And the advertiser is rewarded by showing higher in the search result pages.
Price no longer trumped relevance and it allowed the small businesses to get a head of the bigger businesses by having a better offer. And Google made more money because the ads that were getting clicked on were showing up at the top.
Of course getting someone to arrive at your site is only the first step in a much larger picture. But before we can build a website that will convert a visitor into a customer we first need to understand how people search.