How much is BP really paying for those “oil spill” PPC ads?


The piece quoted Maureen Mackey, a writer on the Fiscal Times as saying: “What it effectively does is that it bumps down other legitimate news and opinion pieces that are addressing the spill… and [BP are] paying big money for that.”
Er, not quite.
First, BP are buying PPC ads – so they are hardly bumping natural search results anywhere. Second, there is an assumption that BP must be paying “big money” for these PPC ads.
Let’s take the phrase “oil spill”. Sure enough, plug it into Google and BP’s ad is there at the top – in fact, it is the only PPC ad on the page (at least when I did it).
So how much would BP have to pay for this? Using Google’s free Traffic Estimator tool, it would seem they would pay a maximum of $1.38 per click. And
Google estimates the number of click throughs that BP would get as between 29 and 45 per day. In other words, a cost of around $70 per day – maximum.
Now BP may well be bidding on lots of other “oil spill” related terms – but I’d hazard a guess that their total PPC budget for achieving these top ad positions is not nearly as much as some people assume (ironically, The Times article has probably done more to encourage people to search for the term “oil spill” and for people to click the ad in curiosity).
If you look at historical bidding patterns on the term “oil spill” you’ll see that nobody has really bothered much about it. In fact, in March in the UK (pre-BP crisis) not a single company was bidding on the term. In April, a lot more companies started bidding on the term both in the US and UK. Curiously, everyone seemed to stop bidding on it in May. And BP are probably the only one of a handful of companies bidding on the term right now. Coupled with a relevant landing page, that probably translates into a relatively low PPC cost.
Of course, the big question many people are asking is – are BP right to be buying PPC ads around these terms?  The moral issue aside, the notion that BP are bleeding money on this exercise is probably wide of the mark.
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