Trends in Pay-Per-Click Advertising
In recent years, online advertising has become a huge market for both companies and advertisers alike. We can analyze this trend by looking at a sample of advertisers on Google, one of the biggest and most sought after providers of this service. Google’s AdWords ad network displays advertisements from their customers on the side of and above Google’s search results as well as on its content network sites. We can see, first and foremost, from the sample statistics that from 2005, there has been a large overall increase in the cost per click for advertisements. Of course, this depends on where those advertisements are situated on Google and its accompanying sites; however, a increase from a mere $0.38 per click on average among the sample sample advertisers to around a dollar in recent years allows us to draw obvious conclusions about the rise in demand for online advertising. In addition, because of Google’s better detection of invalid clicks and inimical activity, invalid click rates have been increasing; along with this however, also comes an increasing cost per conversion as more companies and businesses discover pay-per-click advertising and the benefits it presents. In 2012, Google was able to provide more clicks at lower costs by expanding its display network with further options.
In short, we can glean from this data the permanence and, in fact, growth of pay-per-click advertising in today’s markets. Advertising now plays a major role in the market, not only as a means of expanding markets, but also as a market in of itself. We can see from the data the growth of this market and the prices at which businesses are willing to pay. Obviously, conversions (a factor of success for the advertisement) as well as changes in Google’s ad network structure are reflected in the prices and rates of par-per-click every year. Data trends over time are a great way to observe the process through which advertising has changed in the market.
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