Pay-for-Position Traffic Gets Hot

We’ve talked mostly about techniques for achieving good rankings in search engines and getting appropriate listings in directories. But there are places out there that will list you if you’re willing to pay. Not only that, some traffic agencies are using third-party pay-per-click traffic to fulfill their traffic delivery commitments. So pay-for-position search engines are getting a lot of attention these days.

The two most popular pay-for-position (or pay-per-click) engines are Mamma.com and GoTo.com. Mamma calls itself a “smart meta-search engine.” When a user enters a query at Mamma, it simultaneously queries ten major search engines, creating a virtual database of organized results presented by relevance and source. So it’s going to get you both reach and relevance that is worth paying for. Current stats on Mamma are available at: http://www.web-ignite.com/mamma/.

GoTo describes its service as “search made simple.” With this model, “advertisers choose their priority listing in the search results by paying for placement, with the highest paying advertiser’s site appearing first in the results. Each advertiser pays GoTo the amount of its bid whenever a consumer clicks on an advertiser’s listing in the search results.” I requested stats from GoTo and have yet to receive a reply, but will report information on its numbers (monthly impressions, searches-per-day and the like) in a postscript if it becomes available.

What I like about pay-for-position engines (and there are a number of them) is the predictability factor. They have a distance to go, as far as ordering up just about any amount of traffic you want; however; you can set up an account and receive as much traffic as necessary to evaluate your return on investment (ROI).

With adjustments of keywords, appropriate bidding, and a calculator, you can set goals to buy the best keywords at the least cost. Then you can apply this knowledge base to the big seven engines (AltaVista, FAST, Northern Light, Google, Excite, Inktomi, Go-Infoseek) and the big five directories (Yahoo, LookSmart, Lycos, Open Directory, and Snap) for generating more of the same quality traffic.

These programs are frequently described as pay-for-performance, pay-per-click, pay-for-position, or pay-for-placement. Basically, they let advertisers choose their own positioning in the search results by paying for placement. The highest paying advertiser’s web site appears first in the results. Lower bidders follow. Then these advertisers each pay the performance engine the amount of its bid whenever a customer clicks on the advertiser’s listing in the search results. Below are some of the benefits and drawbacks.

Benefits

• Your web site is instantly ranked number one (or two or three, depending on your bid) in the engine database.
• You only pay your bid amount when a user visits your web site.
• You can add or remove keywords at anytime.
• You’re ranked high in an engine where users are searching for your specific product, service or information, therefore get highly qualified traffic.
• You can start, stop, or re-start whenever you like.
• The cost of entry is low.
• You get your web site title and description display text exactly as you want it.
• You can test various titles, descriptions, and positions.
• Changes are usually instantaneous.

Drawbacks

A pay-for-performance strategy can be very useful; however, be careful if you are asked to pay a significant retainer without a predetermined delivery time frame. It is quite possible the traffic you are seeking might take several months to accumulate. Then you’re at the company’s mercy when it comes to traffic delivery.

GoTo.com is nice because it offers a pay-as-you-go plan. Mamma.com is nice because it offers a lock-in price fix on your bid for 12 months. Each has its own benefits.

A few traffic agencies that specialize in providing search engine traffic offer pay-for-performance (pay-per-click) plans, slipping in GoTo.com third-party “pay-for-position traffic” to assist in fulfilling traffic delivery commitments. This goes to show the increasing popularity of search engine traffic in marketing campaigns, making it hard to fulfill traffic delivery commitments.

GoTo.com was tight lipped about the process of brokering its traffic to third-party traffic agencies. Apparently, only its largest, long-term customers have access to this broker/client-side service. We are working out a plan with GoTo for special accounts.

Pay for Position Vs. Pay for Effort Pricing Models

You might ask, why not use pay-for-performance engines and at least get something for my money? Most pay-for-performance programs charge a retainer, deposit or set-up fee approaching 25 percent of the contract. Others have a recurring monthly fee of $500, $1,000 or $2,000 per month plus your cost-per-click, i.e., pay-for-performance.

Pay-for-performance requires a trust factor, or the belief that you will receive this traffic. If you are given no predetermined time frame for the delivery of this traffic, you might as well put your money in a mutual fund, it’ll grow much faster.

The pay-for-effort pricing model also requires a trust factor that the effort will produce specific measurable results from month to month. Most pay-for-effort pricing requires a monthly fee consistent with cost-per-click pricing; however, the clicks are all yours at no extra charge.

An advantage of the pay-for-effort model is that it provides an accountable monthly tracking/reporting system to evaluate your goals and objectives. Tracking allows you to evaluate whether the effort, according to your predetermined objectives, was worthwhile or not. If it is, and the traffic agency did what it said it would do, you ramp-it-up; if not, you simply cancel and go on to test your next campaign. Either way you go (pay-per-click or pay-for-effort) plan on a six to nine month evaluation period.

Here are some the reasons why I like the pay-for-effort (pay-as-you-go) pricing model:

• Definition of results are identified before you start paying.
• You move forward based on actual results.
• The process is objective and measurable.
• It either works or it doesn’t.
• Predictable and turn-key.
• No modification to your web site.
• It can be scheduled month-to-month.
• You can start, stop or get out anytime.

Most search engine traffic agencies and pay-for-position engines will soon be increasing their prices and bids to catch up with banners. They’ll probably meet somewhere in the middle. Be wary if it sounds too good to be true. It probably is.

In the future, look for more search engine traffic agencies to combine pay-for-position search engine traffic from GoTo.com and others with pay-for-effort search engine traffic as a simple way to supplement their performance. The competition for search engine traffic has always been very high, and right now you are likely seeing the lowest prices you’ll ever see in months or years to come.