Cost Per Click or CPC (as it is often initialized to) is a phrase often used in online advertising and online marketing circles.

With many advertising networks and websites, the advertiser is charged for advertising their ad (on the advertising network or website) only when a user clicks on their ad. How much they pay (for that click) is called their Cost Per Click or CPC.

The CPC can be determined by different factors, depending on which advertising network or website the advertiser is advertising on.

Other common forms, of charging for advertising, include:

• CPM
• CPA
• CPT

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Effective Cost Per Action (often abbreviated to eCPA) is a phrase often used in online advertising and online marketing circles.

CPA is considered the optimal form of buying online advertising from the advertiser’s point of view, as they only pay for an advert when an action has occurred. An action can be a product being purchased, a form being filled, etc. (The desired action to be performed is determined by the advertiser.)

eCPA is used to measure the effectiveness of advertising inventory purchased (by the advertiser) via a CPC, CPM, or CPT basis. In other words, the eCPA tells the advertiser what they would have paid if they purchased the advertising inventory on a CPA basis (instead of a CPC, CPM, or CPT basis).

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Cost Per Action or CPA (as it is often initialized to) is a phrase often used in online advertising and online marketing circles.

CPA is considered the optimal form of buying online advertising from the advertiser’s point of view. An advertiser only pays for the ad when an action has occurred. An action can be a product being purchased, a form being filled, etc. (The desired action to be preformed is determined by the advertiser.)

A related term, eCPA or effective Cost Per Action, is used to measure the effectiveness of advertising inventory purchased (by the advertiser) via a CPC, CPM, or CPT basis.

The CPA can be determined by different factors, depending where the online advertising inventory is being purchased.

Other common forms, of charging for advertising, include:

• CPC
• CPM
• CPT

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Smith and Chaffey (2001) describe five key online marketing activities (the ‘5Ss’) which can be applied by an organisation to implement various online marketing tactics. For example, for an e-newsletter, the 5Ss are:

• Sell - Grow sales (the e-newsletter often acts as both a customer acquisition tool and a retention tool - the lastminute.com e-newsletter has this dual role)
• Serve - Add value (give customers extra benefits online such as an online exclusive offer or more in-depth information about your products or the industry sector)
• Speak - Get closer to customers by creating a dialogue, asking questions through online research surveys and learning about customers’ preferences through tracking - which content are people most interested in.
• Save - Save costs (of print and post if you have a traditional offline e-newsletter can you reduce print runs or extend it to those customers you can’t afford to communicate with)
• Sizzle - Extend the brand online. A newsletter keeps the brand ‘front-of-mind’ and helps reinforce brand values. Added value can also be delivered by the e-newsletter by informing and entertaining customers.

Capturing attention of potential customers can be as simple as advertising using some of the new advertising tools the online world provides, such as advertising on search engines, but it can also be about configuring more remarkable methods that tend to spread across many sites and capturing the imagination of many people in the process. There are at least three major configurations of links and tools that have been used to capture attention online: funnel building, buzz marketing and cool tools.

Building a sales funnel requires working with search engine optimization, email newsletter distribution, discussion board entries, advertisements, affiliate activities and more. In fact, any way that additional links can be provided so that a potential customer can begin a conversation with a business, is educated about that business’ products/services, or is provided with concepts and propositions that will eventually lead to a sale. A funnel is usually laid down over time and is the result of continuous activity of marketers in online activities.

Buzz marketing tends to be a much quicker process and tends to involve less activity on behalf of marketers and requires attention of people online to spread by word-of-mouth, word-from-keyboards, to be fascinated or intrigued. Purple cow was sold largely through buzz marketing that spread by blogs relatively quickly.

Another tactic of gaining attention online is through the development and release of a cool tool. A cool tool is something that captures the imagination of the online browsing public and it is thought to be so cool that it should be shared with online friends. This could be a video clip, standalone software that is cute such as a cartoon character that lives on a users screen, or some other device that is used often for a specific purpose, such as 3Ms Post-it Notes.

Right in the middle of a new marketing practice is eBay with its datafeed marketing. Essentially a store owner sets up his/her data in eBay and then by way of feeds make this data available to advertising avenues, such as Froogle, Yahoo Product Search and about another twenty of thirty other sites that take datafeeds. All the advertising feed services point the prospective purchaser to the eBay auction. This is perhaps a little like building a sales funnel as described above, however, it uses a specific technology that enables ease of use.

Marketing on the internet requires that one be found using keyword searches or some form of online advertising. In any case the trick to being successful in Online Marketing is being found within the top 30 search results. There are 3 ways that one can be found. 1.) natural search engine ranking (70% of searchers will skip over sponsored results and start with the naturally ranked sites) 2.) Paid inclusion and 3.) Pay per click. Due to the extreme difficulty of achieving a natural high ranking on a major search engine most companies opt for #’s 2 and 3 for their online marketing. Unfortunately the 3rd option is very costly and only the most well heeled companies can afford to market online via pay per click.

What is true of Online Marketing today is that one must pay to play. Since the dot com bust several years ago search engines have discerned that in order to survive and thrive they must generate significant revenue. At first the hope was that banner advertising would be sufficient to fill the search engine coffers but it soon became evident that searchers did not respond to banners. It then became evident that there were 2 primary ways to create income for search engines and online directories. Thus paid inclusion and pay per click were born!

Recently potential greed-related challenges have emerged. There are companies that create false hits and traffic. Most recently Google has been sued for click fraud. [1] Whether or not the charges prove to be true, actions like this make people think twice about using pay per click as part of their online marketing package.

Semantic logic will allow searchers to use not just keywords to search, but rather they will search using common language. This is a big departure from the crude Boolean logic which has served the Internet searching community for the last decade.

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Online Marketing is marketing on the Internet. It is a type of e-marketing, which in turn is a type of e-commerce. While at first the confusion of experiments, beta versions of websites, search engines and other online devices cause marketers to consider this world of the Internet unknowable and perhaps too unpredictable, there is now a growing body of work to which marketers are now paying attention in order to develop online marketing programs. The most known tools to marketers in the mid 2000s are currently tools grouped into 2 fields: online advertising and search engine optimization. E-marketing tools used to drive visitors to a web site include:

However, marketing online is simply not offline marketing applied to a new online world. Online marketing has a slightly different character and purpose as indicated in such seminal works as The cluetrain manifesto, Purple cow, Permission marketing, and other texts of smaller nature compiled in blogs and news sites.

References

• Smith, P.R. and Chaffey, D. (2001) eMarketing eXcellence: at the heart of eBusiness. Butterworth Heinemann, Oxford, UK.
• Internet Marketing for Less Than $500 Per Year. ISBN 1885068697
• Building Your E-Bay Traffic The Smart Way. ISBN 0814472699
• The Online Copywriters Handbook. ISBN 0658020994
• The Complete Idiots Guide to Online Marketing. ISBN 078972037X

Video: Internet Marketing Secrets 1 of 3

Billboards and street advertising in Shinjuku, Tokyo, Japan, (2005)

Generally speaking, advertising is the promotion of goods, services, companies and ideas, usually by an identified sponsor. Marketers see advertising as part of an overall promotional strategy. Other components of the promotional mix include publicity, public relations, personal selling and sales promotion.

Online advertising is advertising on the Internet. This particular form of advertising is a source of revenue for an increasing number of websites and companies.

There are two sides to online advertising, a legitimate one and an illegitimate one. The legitimate side of online advertising includes search engine advertising, advertising networks and opt-in e-mail advertising. The illegitimate side is dominated by spamming.

Though the range of advertising options has expanded since in the commercialization of the Internet, the use of rich media and static images is extremely popular. The ever-increasing audience of online users will likely continue to be a major advertising market.

This guide is licensed under the GNU Free Documentation License. It uses material from the Wikipedia.