[Online Marketing] Pay Per Click

Pretend, for a moment, that you’re not a PCO. Instead you’re a consumer, looking to hire a pest control professional. Say you live in Chicago, and you have a terrible ant problem. But when it comes to picking a company to call, you’re coming up blank.

Do you run to your coat closet, and pull down one of the several 10-pound phone books you’ve got piled up there? Or do you simply sit down at your computer, go to Yahoo.com, type in “ant control Chicago,” and then see what comes up?

Let’s say you choose the latter option. What you end up with is a few companies listed inside a light blue box — called “sponsor results” — at the very top of your search results. Then more Web sites are listed below that box, called organic results, some of which are pest control companies and some of which are not. On the right side of the screen are more “sponsor results,” and still more appear at the bottom of the page.

At this point, for you the consumer, the initial problem is solved. You’ve got a list of companies from which to choose. Now all you need to do is click on one or more of those listings, sponsored or not, examine and compare the Web sites you are taken to, and decide which company to call first.

As a PCO you know that having an appealing, relevant Web site speaks volumes about your company on everything from technology to quality. But it’s only part of the equation. After all, what good is having a top-notch Web site if no one can find it?

That’s where pay-per-click advertising comes in. With pay per click (PPC), consumers are presented with mini advertisements that match their search criteria, in the form of sponsor results. And every time someone clicks on one of these sponsor results, the advertiser pays for the click.

So PPC advertising works just like Yellow Pages. And for an industry such as pest control, which has historically relied heavily on its Yellow Pages advertising to generate leads, it’s worth taking a hard look at this new technology to see how it might work for your business.

HOW IT WORKS. Using pay per click as a form of advertising is a growing trend, particularly in the pest control industry. Research conducted this past winter by PCT magazine indicates that about 21 percent of pest control companies have advertised via pay per click.

Furthermore, research indicates that online advertising, including PPC, is increasingly displacing the Yellow Pages as a way for companies to generate leads. Research sponsored by the research firm The Kelsey Group, based in Princeton, N.J., indicates that 12 percent of consumers now use search engines first when looking for local business information. And of those consumers with annual income more than $75,000, 27 percent use search engines first.

Pay per click makes good business sense, particularly for those who have placed value on having a quality Web presence. It serves essentially the same purpose as Yellow Pages advertising, however instead of placing your ad in a book where it remains unchanged, the ad appears under specific keyword searches on the Internet. The ad can be changed or removed at any time. The Web page it links to can be updated or changed. And you only pay for your ad when someone clicks on it.

The amount you pay for each click is dynamically determined via a bidding process. Since there are likely several companies that would want their name to come up under a search for “ant control Chicago,” companies have to bid for prime placement of their ads under specific keywords. And whoever bids the highest amount for a particular set of keywords — say $5 for “ant control Chicago” — is likely to show up prominently in the sponsor results. (However, spokespersons for the major search engines point out the relevance of a company’s ad in comparison to what the consumer typed in also plays a role in where the ad will appear in the sponsor results.)

Advertisers also can set budgets of how much they are willing to spend, even on a daily basis. Once that budget limit has been reached, their PPC ad no longer comes up.

One of the concerns of PPC is that competitors will repeatedly click on the sponsor results, causing advertisers to be charged for a high number of worthless clicks. However, search engine representatives say they are aware of this and they don’t charge for repeated clicks coming from the same IP address.
 
TANGIBLE RESULTS. Pest management professionals who have used pay per click say, for the most part, it is delivering trackable results when it comes to leads, and sometimes, sales.

Trey Scarborough is co-owner of Chemical Technologies of Georgia, based in Lawrenceville, Ga., and serves the metro Atlanta area. Scarborough handles the marketing for the company and has used PPC advertising for several years. He says five years ago, PPC was “phenomenal,” in terms of the return it provided, something like $20,000 in revenue for every $1,000 spent on PPC, he said.

However, he notes, the returns have diminished over the last few years. “I really think we were one of the first few companies that got into the pay-per-click market,” Scarborough said. It was very effective at the time, he said, but “as more companies have gone into it, the bid rates have gone up.” Now he says, it’s “not nearly as good” as it used to be. He says the returns have gone down in the last year or two.

Scarborough said one of the problems he has noticed is what he refers to as “junk clicks” or clicks that don’t result in phone calls. However, the company works hard to track its leads in this area. Customers are always asked how they heard about the company. And Scarborough tries to track his company’s PPC effectiveness by tracking monthly sales revenue vs. monthly advertising costs.

Other pest management professionals are having more favorable results with pay-per-click advertising. Mike Rottler, president of Rottler Pest & Lawn Solutions, St. Louis, has employed PPC for a few years with good results.

“It’s a marketing strategy at our company in general to try to send quality leads to our staff,” Rottler said. And one way he does that is through pay-per-click ads.

Rottler says the number of leads his company receives due to PPC and other online sources is growing. He says about 6 percent of the company’s leads are generated from online sources. Last year, the company received 640 leads from online sources. Of those, said Rottler, around 41 percent were turned into sales.

“In terms of efficiency, I think it’s worthwhile,” says Rottler. “For the amount of money that we budget, I think we feel like we get pretty good results from our online and our pay-per-click (advertising).” In all, Rottler says each lead his company receives from PPC costs around $12 to $15. And he says, “I still believe it’s cheaper than what I spent on my Yellow Pages cost per lead.”

Rottler agrees clicks don’t always equate to leads. For instance, in some cases, consumers click on the site but then don’t submit their contact information or call the company. However, he says PPC is still a good way to generate leads, and he notes understanding and driving leads can be a good indicator of future sales.

“If you’re in sales, it’s all about seeing customers,” he said. “One way of getting to see customers is to generate leads. Pay-per-click advertising is one way to generate leads.” Other ways, he noted, are Yellow Pages advertising or door-to-door sales. “It’s all in what your strategy is,” he said.

With online advertising, Rottler notes, including a well-designed Web site, consumers can have a much richer experience of the services a company provides. And pay per click, he believes, “is a better way for consumers to buy pest control than the Yellow Pages.”

Previously Rottler handled his PPC advertising on his own, but within the last year he hired advertising agency Gruen Marketing Services, based in Minnetonka, Minn., to manage this part of his business for him. The company does this through its FindRefined.com service, which handles digital advertising. “We give them a monthly budget and then they in turn manage the budget,” Rottler said. Furthermore, he said, “we look at our lead flow off of the budget.”

Gruen Marketing also handles Rottler’s Yellow Pages advertising. Rottler says he still uses Yellow Pages advertising, but has cut his spending back a bit. “We do a good job at looking closely at our numbers and I can tell you we have not received the number of leads from the Yellow Pages that we have in the past,” he said. Furthermore, Rottler says he is now using unique phone numbers in his Yellow Pages advertisements to get a handle on how much business it’s driving their way.

Rottler says the number of leads his company receives from online sources is still less than the number he receives from the Yellow Pages, but it has gone up significantly. “I think it’s a growing piece of the business,” said Rottler. “Right now it’s a third of what I get off the Yellow Pages.”

Eden Advanced Pest Technologies, based in Olympia, Wash., also uses Gruen Marketing and its FindRefined.com service to manage both its pay per click and Yellow Pages advertising.

Jen Marlowe, marketing director for Eden Advanced Pest Technologies, points out it’s important to make sure your Web site is prepared to handle the increased traffic before incorporating online advertising. “If you’re going to invest money in leads, and that advertising is driving people to your site, you also want to invest money to keep people at your site,” Marlowe said. That means the site should be user friendly, visually appealing and informative to meet consumers’ educational needs, “so they feel they’re getting helped from your Web site,” Marlowe explained.

One of Eden’s PPC strategies is to have a dominant position in the search results. That means choosing keywords that are highly relevant to consumers’ searches. Marlowe explained that Eden’s PPC campaign works like an inverted pyramid. “We use keywords that we feel are relevant and monitor their effectiveness,” Marlowe said. “Then we shift our budget to focus on the strongest keywords. We have the flexibility to change those keywords with changes in the season or market trends.”

Gruen Marketing, through its FindRefined.com division, helps Eden particularly in the area of dynamic adword selection. The keywords are always monitored and the company’s ad dollars are always being shifted as the use of various words changes.

“I think that it’s been pretty successful,” Marlowe said of the company’s PPC efforts. “Sometimes the tracking is a little more difficult than you’d like.” Marlowe explained she does receive reports of all the phone calls made to Eden based on pay per click. The calls are also recorded, and Marlowe can actually listen to those calls to see how qualified the customers are. However, Marlowe notes, it’s hard to put a dollar figure on how much PPC is giving back in sales.

Concerning the cost of PPC, says Marlowe, “If I don’t know how much sales I’m getting out of it, I don’t really know what my return is,” she said. “But overall, I haven’t found it to be too expensive. It’s affordable for us and it’s generating leads.”

Marlowe says Gruen Marketing has helped her company by providing different options, then recommending a budget, and finally, by tracking the results. She receives reports showing how many clicks the firm received, but ultimately, what matters most, she said, is the phone calls.

Marlowe said when Eden started its online program, the company was only getting a call ratio of 7.7 percent calls to visits. Since then, the efficiency has improved to more than 12.8 percent. Furthermore, Marlowe said, the company actually decreased its online spending over the winter, as recommended by Gruen, and during that time the visits decreased but calls and other leads increased.

Marlowe said that for February 2008, and in other months, the Internet and Web site marketing efforts generated the second highest number of leads, second only to Yellow Pages.

OUTSIDE HELP. The two major search engines, Google and Yahoo, both offer pay-per-click advertising directly to business owners: Google AdWords, and Yahoo Sponsored Search. However, there are a number of other companies that specialize in helping businesses make the most of their pay-per-click dollars.

One such company is the previously mentioned Gruen Marketing Services. Bruce Gruen, owner of the company, notes that pay-per-click advertising is “100 percent accountable.”

“Our customers not only know who’s called them as a result of it, they can actually listen to phone calls as a result of what we do online,” he said. They can do that, Gruen explained, because the pay-per-click ads link back to the company’s site with a unique phone number that’s tracked by Gruen, and the phone calls are recorded.

Gruen points out the effectiveness of PPC can vary geographically. He notes, for example that Des Moines, Iowa, is still very print-based when it comes to advertising, while Seattle, for example, is more online oriented.

And Gruen says pest control companies who are considering PPC should also strongly consider hiring outside help, rather than go it alone. “They’ll spend a whole lot less,” he said. He notes that while Google is easy and intuitive to use, placing ads via Google AdWords is surprisingly complex. And, he says, “you end up spending too much money doing it.”

For example, Gruen referred to a pest control company that was previously handling its PPC advertising on its own, and was doing a very good job with it, but then they agreed to work with Gruen. Costs for the online part were cut in half, Gruen said, their response rate went up 20 percent, and their staffers no longer had to handle it. Before hiring Gruen, the company had one person handling their PPC efforts, almost full time.

However, Deanna Yick, a spokesperson for Google, says her firm’s online advertising program, Google AdWords, is easy to use. And while some companies may prefer to hire outside help, other companies find that they can do it on their own. Yick notes that a company’s placement in sponsor listings depends on two variables: bid and relevance. The relevance of an ad is determined algorithmically, she says, based on a number of factors. Furthermore, she says, “you cannot pay your way to the top,” when it comes to pay-per-click ads.

“Every search is running a new dynamic auction,” Yick said. “There’s a number of ways to be successful and it’s very easy to do so because we level that playing field.”

Gruen said the FindRefined.com service covers all the major search engines, plus the online Yellow Pages. And a growing number of pest control companies have tapped the company for help, he says. “We’re probably doing more business with pest control than we are with any other single industry,” Gruen said.

Another company that offers help in the area of online advertising is ReachLocal, an online advertising agency for local and regional businesses that manages and tracks companies’ PPC campaigns. The service allows companies’ pay-per-click ads to appear on all of the major search engines, and all activity and phone calls are tracked. Companies may pay a small startup fee, then the monthly ad budget covers ReachLocal’s fees.

Reports driven through ReachLocal show what the consumer actually searched for, which search engine was used and what the consumer clicked on. Phone calls are also tracked and recorded.

Complex computer algorithms help refine keyword selection and ad placement. The data that is generated is used to automatically adjust the PPC ads so they perform better. “Every day, twice a day, our system runs through every click and makes minor adjustments to the advertising buy,” said Nathan Hanks, chief distribution officer of ReachLocal.

The company has a dedicated sales force to work with local businesses specifically on their online advertising. Targeted companies are those with between 5 and 50 employees — although some are larger — and are focused on local marketing.
 
A WAITING GAME. The jury is still out on how effective PCOs believe pay-per-click advertising will be. PCT magazine’s winter survey examining PPC and online advertising indicated that about 42 percent of pest control companies are now utilizing online advertising. The only other form of advertising that scored higher was Yellow Pages, with 78 percent of pest management professionals responding that they use this advertising method.

Of those companies that have used pay per click, about 35 percent characterized it as very or moderately successful in terms of clicks. Meanwhile, close to half, or 45 percent, said it was moderately or very unsuccessful. Not an ideal showing for a technology that appears to be so promising. Still, about 22 percent said the leads received turned into tangible accounts, and 45 percent of respondents said they would use pay-per-click advertising again.

But however pest management professionals feel about this technology, it appears that online advertising, including PPC, is a trend that will continue, and it will continue to evolve. PCOs’ success in this area may also evolve, as more professionals further develop their online presence and learn their way around this complex advertising medium.
 
The author is a frequent contributor to PCT magazine.

Industry Suppliers Also Using Pay Per Click
Manufacturers serving the pest control industry also are taking advantage of pay-per-click advertising to help sell their products through the professional pest control industry.

“We certainly use pay-per-click advertising as a tool for our interactive and online marketing,” said Nikki Hall, communications manager for DowAgrosciences’ Urban Pest Management business.

Hall said DowAgrosciences uses PPC to advertise its Sentricon and Vikane brands and to help reconnect these products with professional pest control operators. Sentricon and Vikane each has its own Web presence, which is advertised via pay per click. A search term such as “termite control” may trigger Sentricon to come up as a sponsor result.

The ultimate goal of the sites and of PPC campaign, said Hall, is to receive what she refers to as “conversions.” That occurs when a consumer clicks onto the Sentricon site, perhaps because of a PPC ad, then clicks through to “Find an Authorized Operator,” where they enter their ZIP code. At that point consumers will receive a list of authorized operators within a 50 mile radius of their location. Another conversion opportunity is when the consumer visiting the Sentricon site completely fills out the “Termite Risk Calculator” form.

DowAgrosciences also helps its authorized operators by its partnership with the marketing firm Market Hardware, based in Bethesda, Md. Through this partnership, the firm is able to offer discounted Web site assistance to authorized operators.

Hall said the company’s pay-per-click campaign, which it has used for close to five years, works well. “It offers us a guaranteed placement,” Hall said. Furthermore, she added, “it allows us to set a daily budget and we don’t exceed that budget.” Hall said the campaign is yielding a conversion rate of about 87 percent, meaning 87 percent of those who click onto the site will go on to enter their ZIP code or complete the Termite Risk Calculator. “We feel that is a very successful conversion rate,” Hall said.