Signs for 2013. Reductions on pay per click bidding prices

[charles cawley]

We do comparisons with the cost of cost per click bidding prices one year with the next. Adwords provides a very useful graph facility to do this.

As we are often at the top of the paid adverts for many chosen key phrases, this gives us an indication of how keen other bidders are. Our cost per click goes up and down with the demand, rather like a cork bobbing up and down on the sea.

A comparison of 2011 to 2012 showed two radical changes. From Mid July to late August, the cost per click was 80% higher in 2012. But, more immediately interesting, is that over the last three weeks, we have seen a sudden fall of about 25%.

The bidding of the dominant booking agencies in the UK is systematic; they have developed it to a fine art, any major changes indicate that something is going on. The question is, what? Are they concentrating on areas of high cottage density? Perhaps the overall market is weak so they have cut advertising saving money for the major booking months of January and February? Or could there be something more fundamental to do with immediate economic imperatives?

If nothing else, it looks like 2013 will be an interesting year.

[CSE]

Charles I do not have a clue what you are saying; sorry.

[charles cawley]

Pay per click. I am sorry if I was not clear enough. This is not that simple an area to know about, but it is well worth the knowledge once you get there, even if you do not use PPC yourself.

The ads you see at the top of Google, Yahoo and some other search engines charge per click.

If others below you up their bids so you end up paying more, just like in an auction where you leave an absentee bid. Where, in an auction, you either win or get nothing, with PPC if you do not bid enough, your ad does not appear at the top.

Thus, you can find out a bit about how much people are spending on advertising... how much they are choosing to spend, by seeing how your pay per click costs go up and down responding to their bids.

If they bid higher so your costs go up... assuming your maximum bid the highest of all. All this means you can get some idea of the market related to spending decisions of the dominate players. In the UK, Wyndham Worldwide (Hoseasons, Cottages4You, Welcome Cottages, English Country Cottages etc etc) has an influence over the entire cottage market virtually unknown anywhere else in the World.

This dominance means that if they and one or two other major booking services decide to change their PPC bids it can a direct affect on how high the cork bobs.

[CSE]

Charles, I have dabble in Google adwords, I do not know if it is the same as Adwords?
Anyway to be honest I found it a waste of time and (although I had several vouchers) a waste of money. The vouchers value quickly ran out and they charged me for the extra.
My Goolge statistics showed that I never had one click through even though the ads said I had.
I fell that to get the whole thing setup right would have taken far more time that I was prepared to use. Then having read up on line, with bamboozling words and phases felt hopelessly lost.
A small tourism trading association we are in also has ads, by Google, they are presently wasting something like 200 to 300€ per month with little results. Thankfully the wife is the Treasurer and will hopefully put an end to this.
Using this system may help SEO work but again it takes far too long to set up and change. Like thinking how to add “those” words or phases into your copyright seems a like a task for...well.
I know I am hopeless.

[Lindisfarne]

Thanks for that Charles

The savvy internet searcher is now bypassing the 'Paid' adverts as quite often the results have little or no bearing to what they have searched for.

I for one and many of my friends don't waste time and go straight to the free results which are directly related.

Incidentally I know a local agent up here that spends around £ 2000 per month on adwords pay per click

What do others think on this ?

[CSE]

By the way I should have added I use Adblocker on my web explorer. So I do not see most of these adverts thankfully.

[Lindisfarne]

By the way I should have added I use Adblocker on my web explorer. So I do not see most of these adverts thankfully.

I think that backs up what I said above about people getting sick of Adwords and bypassing them !

[charles cawley]

The idea was that the way ppc was behaving might indicate something interesting to come.

Many people get stung because they do not take time to learn how to use them. If used carefully, they can get results but they tend not to be really very useful for single or two or three cottage operators.

The quality of visitor for ppc ads is vastly higher than organic. Average pages per visit is about triple for each ppc. Relying on organic search results alone for many areas would be impossible for many large operators.

The large agencies spend millions on ppc. They do not willingly pour money down the drain. The seo people sell their services saying more and more people ignore paid ads and promise, for if you use their services, from then on you will get 'free' advertising.

If you are looking for a cottage on the internet nearly everyone will click on a ppc because they are not paying to do this. Without ppc many businesses woudl not surivive. The fact that they do and many prosper using this service proves the point.

I was trying to indicate something else about how the market is behaving and wonder what you feel about this aspect. We spend well over 30,000 Euro per annum on ppc and it does work for us but a debate about whether ppc is a good thing or not was not my intention. They are here and are used and the information on how they behave and what they might reveal of the current market could be useful to everyone.

[Nemo]

Well obviously people do click on the paid ads, but like others here, I avoid all paid ads like the plague. Clicking on one is a last resort if the website I want just hasn't appeared in the free search.

I guess I have learnt enough along the way, mainly from here I suspect, to know it doesn't help me or the site owner to force the spend. But then I'm an advertisers nightmare; I always fast forward through ad breaks and if watching something on the computer I simply leave it running through the breaks, do something else in the interim, then start watching after the ads have finished.

Sorry Charles I'm adding to the debate you didn't want to start! Interesting observations from your end though and as you prove there are clearly thousands of people who do click.

[charles cawley]

If you can save 50% of all the pay per click we spend over two years, you can have the other half as a fee. Payment by results. Yes, that will be well over 20,000 Euros. The same offer is open to others who appear to think we are not running as efficiently as we could. We spend nearly 60% of all income on ppc, alone, for our owners before other marketing and all the rest of admin, debt collection etc.

The possibility of a vast bonanza awaits for anyone who can half the multiple millions spend of Wyndham Worldwide on ppc. Pay per click is here and billions of euros / pounds / dollars are now spent on it. That is a fact which, like it or not, is a reality. To think it will go away is rather like hoping newspapers would or could publish without advertising.

Something for nothing is not a commercial reality. You can be absolutely certain that the early days of free advertising when google, yahoo and others ran at huge losses will never ever return. Any long term marketing budgets based on something for nothing will fail.

So, the offer is open. The ball is at your end of the court.

I am sorry to be so blunt but the tone of rather negative replies to my genuine attempt to supply useful information... often the sort of stuff that other agencies would never reveal, seems to be that we are fools for spending large sums of money on behalf of our owners. It is true that we do make suggestions for owners to better market their properties.. and these suggestions have sometimes gone against our interests as they reduce the need, in some cases, for our assistance. So, perhaps, you can recommend to us where we are so mistaken spending vast sums and return the favour?

Cottage owners need to get real. Change is here and you can be certain that the search engine giants and all internet services will do their level best to eradicate or mimimse all free services as soon as they can. They will find methods to prevent ad blocking etc:, simply, because it makes commercial sense and it is a commercial nonsense to provide a fee service at a loss.

Rather than hope something for nothing will carry on, it might be a far better idea to learn as much as possible about internet marketing and selling to be prepared for the inevitable. The free ride is either about to end or it is ending now. If owners do not become expert or at least good at internet marketing most will sink and may be forced either to give up or ask for assistance from those they may least wish to approach. Surely this should be sufficient motivation?

[Lindisfarne]

The free ride is either about to end or it is ending now.

That sounds pretty negative to me !

Going back to your original post with regard to bidding costs and month by month market trends you could add to this by reviewing the time of day that people search and looking at how long they stay on your website and on and on...........

These type of questions and thought processes are better answered by marketing agencies that employ staff to monitor such activity

We ALL know that PPC and paid advertising is here to stay and you obviously provide this as part of your portfolio of services offered to your clients.

I for one want all the portals that I use to advertise my cottages to spend as much as they can but I can't control their spend - They will have people within their organisations pondering the same questions as you.

Good topic - Well done !

[charles cawley]

It might be more negative or self defeating to deny commercial reality. There was lovely time when you could get free marketing from the likes of Google and Yahoo; it simply cannot continue.

The point of the statistics was not so indicate whether we were getting value for money from PPC but to show that the dominating operators in the cottage marketing sector appeared to be changing their marketing spend.

They are highly sophisticated and have programs to slice and dice the numbers in a thousand different ways. The fact that they appear to be reducing click bids says something is happening. We do not profess to be a marketing agency and they charge for this sort of information.. we offered the little we know freely in the hope others might add to it so we all could benefit.

Going off thread missing the point when we wanted to contribute is a pity. There are few reliable indicators of what 2013 will bring but you can be certain it is going to be as tough if not more tough than this year.

If you or any others who have gone off thread have any indications of what the market is doing it would be very positive to contribute and might give us back a little for our efforts.

[lorca]

I find this very interesting Charles. I know little or nothing about ppc. OH has thought about it, but as a tiny business with 3 properties and a very limited marketing budget I´ve always assumed we would be wasting our money as we couldn´t possibly compete with the big boys.

So I wouldn´t begin to know why the dominant booking agencies have cut their spend on pcc - but I too would be v interested in any theories. Thanks for raising the topic

[golfing girl]

I think the large players have dropped their advertising at the moment which could account for the complete lack of enqueries from one of the sites I use as compared with the others which are still sending enqueries. Could it be that they are saving their money and gearing up for the end of December knowing that November and early December is usually very quiet? Possibly so. So thanks for all of that info Charles, I found it very helpful.

[charles cawley]

In the summer, we all bid like mad and ended up paying as much as 80% higher than 2011 cost per click. I think we were all hoping for short notice to make it worthwhile... of course, the wretched weather put a stop on that. It was a major financial mistake on my part to bid so high, in a period when bookings (Late July and August) taken just did not justify the spend.

It could be, for our area, that the recent floods in Worcester and some small local ones have caused the same thing to happen again... but, may-be, the big booking services are not making the same mistake again so the bids per click are going down and not up.

On the other hand, it could be a more serious reflection of the overall market with fewer bookings so causing a much higher marketing cost per sale, in turn, causing the large agencies to think it better to cut their top bids per click. Christmas is not looking as good as last year and last year was not as bright as the year before. It is still good but it is no longer super peak.

Another possiblity is that some large booking services do not have the reserves they would normally expect at this time of year. These are important because the marketing spend in January and February can be a third or more of the entire years marketing cost. But the income from the marketing often only rolls in several months later closer to when the dates of the stays booked actually happen.

In other words, there is an outside possiblity that cash flow pressure might possibly be one explanation. As only a few legacy booking services dominate the UK market in a way unknown in most of the rest of the world, if this is a factor, it could be very significant for everyone else.

I need to do a bit more thinking about this and will report back on click costs in mid January and February. Something is happening out there.