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Online Advertising: Is It Profitable?

The general consensus is that advertising is good for business. But is it really worth the trouble for me? Logically you might assume that it is. After all, we see advertising all about us, in magazines and newspapers, on freeway billboards and on the internet, to mention but a few places. And it doesn't seem to go away. So, someone must be benefiting from advertising, or they wouldn't and likely couldn't keep paying for it.

OK, SO PEOPLE ARE ADVERTISING. BUT ARE THESE ADS EFFECTIVE?

There is no way to look at, say a billboard advertisement, and determine whether or not it is contributing to profits or to losses. But, it is a pretty good bet that an ad is turning a profit if you see it repeated again and again over time. Profitless ads should, and do, get dumped and replaced with other, hopefully more profitable, ads.

WILL ADVERTISING HELP MY ONLINE BUSINESS?

An important question is this: "Is advertising right for my online business?"

The answer is a resounding "Yes! Without a doubt." Advertising, properly done, will increase profits in your business. You can use the following two methods to help make your advertising pay.

METHOD 1: DO-IT-YOURSELF: One way to make advertising profitable for your business is to reduce advertising costs by doing much of the work yourself. Advertising does indeed come with costs, and they can be rather steep. Advertising costs may be translated into money that you pay to advertising experts or into time-consuming, but potentially effective, labor on your part. If you are a small business or are just getting started on a small budget, you will undoubtedly need to strongly consider doing as much of the work of advertising as possible, at least in the beginning. If you choose to spend time doing advertising yourself, you will still incur expenses. But, you can reduce them by doing as much of the work as you can.

METHOD 2: TRACKING AND TWEAKING: The trick is to track and tweak your ads until they are profitable. The effective use of this method assumes that you are repeatedly selling similar items. For instance, you are selling iPod covers and you have a Whole stock of them.

First, after launching an ad, you carefully analyze its costs and the revenue that it brings in over a period of time. Then, after recording the pertinent data and waiting a specified amount of time, you tweak your ad by making one single change and relaunch it. The tweaking can be the substitution of one word for another word or the rearrangement of some elements. After your newly tweaked ad has run for the specified amount of time, recheck the costs and profits and compare them with the previous ad. If the change has increased profits without unduly increasing costs, keep the changes. If the results of your tweaking were negative, make a different change or go back to the original. Then keep tracking and tweaking until your ads become even more profitable. And then repeat the process over and over again, carefully keeping tabs on the effectiveness of your changes.

CONCLUSION

To achieve profitable advertising, you must choose appropriate resources according to your budget: either your own time or the payment of an advertising expert. If your choose to do it yourself as much as you can, tracking and tweaking your ads will put your business on the path to greater profits.

Richard Davidian, Ph.D., a writing professor, writes on topics as varied as internet marketing and the outdoors. Visit his Financial Freedom site to get started on your way. Visit also Freeoutdoors.com for outdoor equipment and OutdoorValueStore.com for survival information.

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