VROA OWNER NEWSLETTER - May 31, 2004
SUBJECT: All About Pay-Per-Click Advertising

Increasing rent for rentals is a lot like a chain reaction. But it's necessary to work backward: before the guest pays, he has to sign a contract. Before the contract, he has to inquire (by phone or e-mail). In order to inquire, he has to know you exist. And in order to know about you, he has to receive a message of some sort alerting him of your existence.

Advertisers know there are a great many vehicles for reaching prospective customers. The big and expensive ones - television, radio, major newspapers and magazines - are perfectly reasonable for big companies with geographically disbursed products. Think soda pop, beer and even insurance companies. But advertising has been a necessary evil for small advertisers forever. How do you reach a specific and often small target audience of receptive buyers?

For years that has been an unanswered question. A larger advertiser once said, "I know that only half of the ads work, I just don't know which half."

The answer for most vacation rental owners is that traditional advertising is simply too expensive, produces too few responses and is impossible to track or justify. But luckily for small advertisers of all kinds, the Internet has arrived. And I believe it has come to be the major reason why second home purchase and rental has been growing so fast.

Now, instead of advertisers searching for customers through old fashioned media, they have the option of advertising or listing their goods and services online where customers can come to find them. It's really a revolution.

It can be affordable, quick to post and easy to change. But it also presents a challenge. With over eight billion web pages posted for consumer inspection, how can vacation rental owners advertise their properties and expect anyone to find them? Even students of the Web are amazed at how quickly its dynamics change.

If you've ever tried to get your Website listed high up on Google or Yahoo, you know it can be virtually impossible. Yes, there are ways to manipulate the system to increase your chances of being seen, though they require a significant commitment of time and energy. But the rules that search engines use change frequently. Just when someone thinks they have it figured out, they find themselves demoted dramatically.

PAY-PER-CLICK
Fortunately, Websites (especially Google) have figured out how to allow advertisers - big and little - to attract customers for at affordable price. (And how to generate billions of dollars in revenue for themselves at the same time.) It's called Pay-Per-Click (PPC) advertising and it allows even the smallest advertisers, even vacation rental owners, to advertise at an affordable cost.

There are a good number of Websites and services that can place your ad on important Websites. Some of these are Google.com, Overture.com, Findwhat.com, Enhance.com (formerly Ah-ha.com), Kanoodle.com and others. All work basically the same way: advertisers create ads that go on the Websites with no minimum. But they pay a fee (often as low as five cents every time a viewer clicks on the ad) which takes the viewer to the advertiser's Website.

There is no guarantee that the viewer will buy anything at your site. But, as we all know, getting customer attention is the challenge. It then becomes the advertiser's job to provide information and photos or other enticements to earn the customer's business.

GOOGLE.COM: Google's system is a bit different than the others. Ads there will get you listed on Google.com on the right-hand border. But it also gets your ads distributed on thousands of affiliated sites. You may have noticed that VROA.org and VROA.com carry Google ads. To make sure the ads produce good results for advertisers, Google uses sophisticated technology to match ad content with sites that attract viewers likely to find those offerings enticing.

OTHER PPC: The other PPC sites also distribute their ads, but generally to well established and larger websites such as MSN.com, AOL.com and the like.

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HOW TO DO IT:
So how do you become involved in Pay-Per-Click advertising? The answer is easier than you think. Here are the details along with a few cautions:

ACCOUNT: Get acquainted with PPC by going to any of the search engines mentioned above and set up an account. Don't worry - you haven't spent any money yet. In order to open your account, you must provide a credit card and plenty of detailed contact information.

WRITE ADS: Next you will be asked to design your ad. Unfortunately, most of the sites limit your ad to a headline, short text (12 to 25 words or so) and, of course, your domain name, such as www.VROA.org. Generally, you can create a number of different ads. This is a good idea when matching the ads to the consumers you want to reach. With a few exceptions, most advertising sites do not allow logos, boxes or banners.

KEYWORDS: Third, you will be asked to select the keywords you think your prospective guests might use in order to find you. Keywords can be single words or short phrases. For our rentals on Poipu Beach, Kauai in Hawaii, we chose the words:

- Poipu
- Kauai
- Hawaii

Using general click-throughs gives us lots of exposure, but it also requires us to think strategically.

- The keyword "Hawaii" will get thousands of clicks a day - far more than we can afford.

- The keyword "Kauai" will get fewer, but still hundreds of clicks, and will include many consumers who are looking for something other than lodging.

- The keyword "Poipu" will get even less clicks, but they'll be from viewers more likely to buy our product.

- The keyword "Poipu Vacation Rental" may only get a dozen clicks per day, but these will be from the consumers most likely to rent.

Most of the sites also have online tools that can suggest other key words you may want to consider. Some will even estimate the number of anticipated daily clicks. For example, if I suggest Poipu for our Kauai rental home, it might suggest "Poipu Beach," "Poipu Rental," "Poipu Lodging" and many more. Most of these keywords will get a smaller number of clicks than the more general words, but there will also be fewer advertisers bidding on the more specific terms. That will prove to be a good way to get clicks at a lower price.

For our various locations, we buy 25 to 200 very specific phrases and almost never buy the general terms. In addition, most of these sites compare "impressions" (every time someone sees your ad) to how many of those viewers click on your ad. Some of the Websites will disable your ad if your "click through" rate is too low.

BID YOUR WAY UP:
In the past, my wife has worked at (and sometimes owned) television stations, radio stations as well as newspapers. As managers, one of our chief tasks was deciding how much to charge for advertising. The question always was, "What will the market bear?" Sure we had to make sure the prices were cost effective for our advertisers. But we also had to generate as much profit as possible. Website operators have solved that old dilemma by setting minimum prices for PPC ads and then allowing advertisers to bid their way up the ad listings by submitting a higher price.

In short, advertisers can choose whether they want to be first or 101st in the list of ads by choosing the price they are willing to pay for each person who clicks on their ad. The top three ads for each keyword are said to receive the greatest majority of click throughs. But remember, you pay a higher price for the higher position. Personally I prefer to take lower positions that produce sufficient leads and pay the lower price. Unless I'm the only advertiser, I almost never buy the top spot.

If you are lucky enough to have your home located in an area with a unique name - such as ours in Chelan, Snoqualmie and Methow - you won't secure hundreds of leads per day with PPC ads, but you will be able to purchase those clicks for a bargain price.

THE SITE DOESN'T MATTER:
You may be tempted to use Google first and maybe only Google. As the largest search engine it can provide you with a many leads very easily. However, it is also popular with your competitors who may very well bid ad costs to the stratosphere. For example, we own ExecutiveSuites.com (for office space) but our competitors are paying up to $8.00 for every click. That is far beyond our means.

Instead, be sure to check out the prices on some of the smaller PPC advertising sites. Usings them may produce a sufficient flow of leads to keep your home full at an affordable cost.

OTHER INTERNET SOLUTIONS
By the way, there are a couple of other Internt advertising solutions you may want to consider. Some of these are "Paid Inclusion" listings on search engines, banner and box ads (now considered less effective) and e-mail marketing. In future newsletters, I will discuss some of those.

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INPUT:
As always I seek your input, please share your tips, techniques, compliments, and complaints on this or any other subject by writing me at Director@VROA.org.

HOME OF THE WEEK:
This week we're off to Hania Crete to visit Katerina Tsebeli's Villa Catani at Kalamaki. It's so beautiful, I can imagine why the Minoan's set up Europe's earliest civilization on the island. Click here to take a look:

(If you want your place considered for Home of the Week, please drop me an e-mail.)

FEEDBACK:
Keep the news coming, I need to be educated and I think it is very interestingly written also.
- Emmett, retired university professor

Thank you very much. I don't recall getting any compliments from professors when I was in college, but I think I am studying more nowadays.
- Wm.May

ONLINE:
See the nice article that mentions VROA in the Press Section of the members-only Website. www.VROA.org.

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VROA OWNER NEWSLETTER
Published weekly for all Members
Copyright - Vacation Rental Owners Association
Read this and all prior newsletters at www.VROA.org

Director & Editor - Wm. May Director@VROA.org
Membership - Penny Taylor Membership@VROA.org
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Seattle, WA 98111-3305
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