How To Control Your Rising
Pay Per Click
Expenses
(And They Are Going To Rise Dramatically)
If you are reading this article while having a cup of coffee or
glass of wine, you can be sure that the store you purchased the
coffee or wine from knows how much (via your membership card)
you bought and when you purchased it. Do you know with the same
precision, which of your Pay Per Click (PPC) keywords resulted
in revenue for your mortgage company?
If you currently purchase PPC keywords, you have noticed an
increase in costs. There has been a constant upward spiral of
keyword costs. Will the trend continue resulting in certain PPC
keywords approach $100 per bid? Many mortgage company owners are
in for shock and will look back to these days of bidding just
$5-$15 per keyword as a true bargain.
PPC & NYSE
Purchasing PPC keywords is becoming similar to buying stocks on
the New York Stock Exchange. Each PPC keyword, much like a
stock, has its own valuation; in example, the current top bid
($9.51) for the keyword "Illinois mortgage" is not the same as
the top bid ($5.50) for "Illinois home loan".
One major difference between PPC and NYSE pricing is that when
you buy a stock, say IBM or Microsoft or General Motors, you
lock in a price, but that stock will fluctuate. It may go up a
couple of points this week, and then go down a couple points
next week; and then maybe go up or down 20 points over the
course of a year or two.
Now compare that to the new world of buying Pay Per Click
keywords from the two major vendors for the Pay Per Click
bidding: Google.com and Overture.com, the prices essentially go
up, and up; and you have not locked in a price.
Buy High, Then Buy Higher Again
Because the Pay Per Click industry is so new there hasn't been a
full market correction yet. So for keywords such as "Portland
home loans" or "Seattle mortgage" or "Kansas home loan" as
recently as two years ago, may have been around $0.25 to $0.60
per click. They are now generally between $4 and $12 per click,
and climbing. Unlike a stock that you purchased at a fixed price
and enjoy the benefits, when the stock price increases, you must
constantly repurchase your keywords at the current price in
today's market or lose your ranking at the search engine.
PPC Bids Will Continue To Increase
The currently market for bidding on PPC keywords will continue
to escalate. Undoubtedly, you will find a market cap at which
point the cost of the keywords exceed the value of the lead,
but, as we are all aware, the tremendous amount of monies to be
earned per closed loan dictates that we have additional market
growth until we meet that PPC saturation point.
Will Bidding Hit $100?
Many dominant players in the mortgage PPC niche are reporting
current expenses between $30 and $60 in keyword bid costs per
generated lead application. We predict that, for selected
keywords, bidding will approach $125-150 per click.
Why Mortgage Companies Will GLADLY Pay $100+ Per Keyword
As the price per keyword continues to increase; many mortgage
companies will no longer bid, because they will say that a
keyword, "Is not worth that much". Yet more sophisticated
mortgage companies will continue to bid higher and higher rates,
and they will do so gladly, having mastered the technique of
optimizing their web site so that they are earning more revenue
than it is costing them in advertising expense.