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The Internet levels the playing field and makes it possible for small businesses to compete with large corporations. If you are new to the world of online advertising, here are some tips on how to get started:
By Reed Richardson

Paid Search
Paid Search allows an advertiser to pay for placement of a site listing or ad within or near a search engine's results. For instance, if your company sells tires, and you want people on sites like Yahoo!® and Google™ searching for the word "tire" to more easily find you, you can pay to have a link to your company's site prominently displayed whenever someone searches for the word "tire."

This is an efficient way to use your advertising budget because you only pay when someone clicks on your link or ad. The cost-per-click (CPC) rate varies and is determined by how often users search for the word, how often they click, and how much competition there is among advertisers to be associated with the word.



Paid Search allows you to gauge the effectiveness of your advertising in real time. You can track: how many people are seeing your ad, how many are clicking through, and what the exact cost is to you. Hint: Using a less general term, like "laptop" instead of "computer," sometimes costs less and is more effective.

Email Marketing
While "spam" is a huge problem that can reduce the effectiveness of email, consider that in the fourth quarter of 2004 the number of orders per email message delivered was 0.35 percent. This was an all-time high, and much higher than the previous record of 0.30 percent (according to a 2004 DoubleClick study). That means there is, on average, one sale for every 300 email solicitations sent.

One of the reasons for this improvement is that marketers have learned the key is to target a specialized list of recipients, rather than mailing to as many people as possible. That's because the effectiveness of your email is largely dependent upon the quality of your list.

For example, if you own a dog grooming business, you might acquire a list of people in your area who have dogs enrolled in obedience schools, or people who buy high-end dog supplies. Any list you use should be an "opt-in" list, where the people have given the list provider permission to send commercial messages. Recipients should also have the option of having their names removed from the list.

With email marketing, you will generally pay a cost-per-thousand-impressions (CPM) rate, which is based on the number of impressions made over a period of time. Or, a cost-per-action (CPA) rate that is based on the number of actions made in response to your message. An action can be defined as a sale, a new customer, or simply a click.

Local Listings
People are searching online for local business information with increasing frequency, creating new opportunities for small businesses to connect with customers. According to a recent research study, 54% of search users have substituted local Internet searches for the phone book, with local Web search growing faster than general Web search.5 Numerous services have sprouted up to meet this growing demand, including the local products of major search engines like Yahoo! and Google, traditional yellow page providers such as SuperPages, and smaller local Web sites specific to a city or region.

One way to increase your visibility to local searchers is by listing your business with one or more of these local search sites. Creating a listing helps ensure your business information is displayed in the results when people are searching in your area. For example, if you sell lamps, you could create a listing under “lighting” and “housewares” to help ensure people searching in those categories see your business in the results. Creating a listing also helps ensure that potential customers receive up-to-date information about your business, which is especially important if you’ve recently moved or changed your phone number.

Most local search services enable you to create a free listing that includes basic contact information (e.g., phone number, address, and hours of operation). For a fee, some guarantee more prominent placement within search results or allow you to provide additional information (e.g., tagline, logo, coupons) to help potential customers notice your listing.

Web Site
It's a no-brainer that the Internet can help you increase your sales and profitability, which in turn can increase the value of your business. According to Forrester Research, e-commerce sales hit more than $75 billion last year.

You should also know that of the more than 300 million people worldwide online today, more than 85 million are in the United States. There are more than 1 billion Web pages in existence. These facts mean you could tap into an amazing opportunity.

A Web site can be a very effective means of reaching new and existing customers and expanding your geographic presence. Breaking down geographic barriers is a good thing for any business owner.

A Web site provides company exposure that customers can access at any time. Hence, a professional Web site is an important first step in tapping the power of the Web. You may wish to hire a consultant to help you with the marketing of your Web site. Simple tactics such as utilizing search engine optimization tools — making sure your Web site appears toward the top of a list when someone conducts a search — can significantly increase the hit rate on your site.

Many larger firms initially gauge the credibility of smaller firms as a business partner by the professionalism of the smaller firm's Web site. Additionally, a Web site offers the ability to capture the information of existing and potential customers, which bolsters the efforts of your sales team.

Reed Richardson is an Associate Editor/Writer for Business 24/7 Magazine.