PAY PER CLICK VS. TV ADVERTISING: THE REALITIES

Update January 26, 2020 A lot of businesses have now embraced Internet Pay Per Click advertising programs without realizing just how expensive PPC advertising really is. Frankly, PPC advertising is probably the most expensive type of advertising you can buy and the cost of Pay Per Click advertising is going to go higher in 2020 because the sellers of PPC ads know businesses have become addicted to it. Let's get real for a moment. On Friday shares of Google closed at $1,466 and shares of Facebook closed at $218. Those stocks are shooting up because of that PPC addiction.

Businesses have become swept up in PPC to the point they've become blind to other forms of advertising. Here's a case in point: Yesterday, one of my clients admitted to me that he's paying $10 per click for his building contractor ads. That's ten dollars per click and not ten dollars per sale or even ten dollars per customer. He's paying ten dollars just to have someone go to his website through his online ad. Think about that. Paying $10 per click is like standing outside your business and handing a $10 bill to passers-by to have them walk into your store. Would you do that? I don't think so. So why do you pay Google ($1,466 per share) and Facebook ($218 per share) so much money?

Television advertising is much cheaper than PPC ads and just as effective.

Consider a $175 one minute spot on my Best Buys TV Show. Let's assume the response rate is a tiny 0.5% which is the same response rate for coupon advertising. If 100,000 people are watching my show, and the response rate is 0.5% then 500 people will have an interest in your video on my show. Now do the math:

$175 divided by 500 means that the cost to reach an interested viewer is only 35-cents. How does that 35-cents compare to paying $10 per click? 

Maybe you don't think 100,000 people are watching my show? Okay, let's say only 10,000 are watching. If only ten-thousand are watching the cost of reaching an interested viewer is $3.50 and that's still only about one third of what Google and Facebook are charging the building contractor for his PPC ads.

I know you love Pay Per Click ads. An entire industry has sprung up to push them. There are PPC ad agencies and PPC brokers and PPC designers. But please, stop and think and do the math. Are those PPC ads really worth what you're paying? Would you really stand at the door of your business handing out $10 bills to passers-by to walk in?

TV is still the king. And it's not going to cost you $10 to get the attention of just one shopper.