Are PPC costs rising, or is it all hype?

Larger corporations have bought into the idea that search engine marketing (SEM) is a viable and worthwhile way to generate leads online. In fact, a significant portion of business owners have begun to funnel resources toward online marketing strategies in the hopes of differentiating their brands on the web.

However, The New York Times recently published an article in which SEM, especially pay-per-click (PPC), was called into question. Journalist Darren Dahl wondered if business owners were abandoning Google AdWords because of rising cost-per-click (CPC) prices.

Cost has always been a concern among small business owners, as SEM and PPC require marketers to bid for keywords and various other display costs. Google also announced a 42 percent increase in paid clicks on a year-over-year basis in the second quarter of 2012, which drove prices even higher.

For marketers on the cusp of allocating more funding toward SEM, it's important to note that in a recent report conducted by Google, CPC prices are actually down 15 percent over last year. In part, the cost discrepancy is directly related to the evolution of online marketing – businesses use several new channels like social media and SEO, so demand for SEM hasn't been as high as it once was.

Don't be fooled by reports that SEM costs are growing out of control, as the practice is still much cheaper than many traditional marketing avenues – PPC requires fewer investments long term.

Sheila Kloefkorn (1029 Posts)

With more than 20 years of hands on marketing strategy and operations experience, Sheila Kloefkorn is dedicated to developing marketing strategies and plans that help clients succeed. Some of the world's largest brands have depended on Sheila for marketing programs that delivered tangible and substantial results. Specialties: B2B marketing, lead generation, lead nurturing, sales strategy, marketing strategy, competitive marketing strategy, social media, search engine optimization (SEO), search engine marketing (SEM), mobile marketing,, email marketing, website design, marketing plans.