Search Ad Costs Soaring

Posted on November 3, 2005

Search ads have made a bundle for companies like Google but the cost of the pay-per-click ads is soaring. A E-Commerce Times article says search engine keyword ads have skyrocketed from 5 to 10 cents per click to $1 per click with some ads costing as much as $50 per click. Actually at one time pay-per-click ads were as low as 1 cent per click. We remember those days. Some advertisers are already pulling their ads because of the rising costs.

In response to the rising ad rates, Jane Moritz recently decided to suspend paid advertising for her small business Get Linux or Windows Managed Hosting Services with Industry Leading Fanatical Support. Latest News about small business and work on making her site more Google friendly. "I was paying $1.50 a click, and then it went to $4," says Moritz, who runs a baked-goods site, Challahconnection.com. "Not every click turns into a sale. You're lucky if you get 30 percent."
There is no ceiling set yet on how high prices could go especially for the more popular keywords.
"It's a supply and demand marketplace," says Gregg Stewart, senior vice-president at search-marketing consultancy Fathom Online. "As more advertisers get involved, that drives prices up."
Corporations do like the top positions which get more clicks. Costs can soar when corporations are actively competing for those pole positions.

More from HowToWeb