In case you haven’t noticed, it probably costs $2 to $3 to bring new visitors to your website, regardless of what type of market that your business serves.  You might be thinking, "I don’t advertise online, why do I care?"

A Little Background on How We Got to This Point

To understand why this directly impacts the bottom line of your business, you need a little bit of history on paying for visitors to come to your website.  The primary mechanism to drive qualified prospects to your website is through Google’s Pay-Per-Click program, Adwords.  When Google first rolled out this advertising platform, it used to cost around $0.10 to bring visitors to your website, regardless of the market you were in. 

The costs for each visitors is determined by a type of auction process.  If someone is willing to pay more than you, they get those visitors you used to get for $0.10 .  And this is exactly what happened.  Companies saw their competitors making huge profits from such a low cost advertising mechanism so they bid higher, and this kept on continuing until we got to the point we are at now, where most profitable markets costs around $2-$3.  Different markets got to this point sooner than others.  But we’re at a point now where if there is any profit in your industry, several competitors are probably paying several dollars for every visitor to their website. 

Everyone Who Owns a Business Should Care

If companies are still fighting over visitors that cost $3 to bring to their website, that means there is still profit there for them.  Basic economics indicates that businesses will continue outbidding each other until the easy profit is gone.  $3 is just a starting point.  That number could get significantly higher for several reasons:

• The competitors in the market will continue to compete over the same visitors and drive up the cost per visitor
• Other competitors will see the profit in online marketing and will continue to flock online in fear of getting left behind (the fact is that the majority of businesses are not advertising online today)
• More and more visitors will be online looking for these businesses.  The growth of the search market only continues to grow and wherever the people go, advertising will follow

Once we get to a more stable point and the easy profits start to disappear, there are going to be several changes from what we see today.  Think about if you started advertising on TV and radio first came out and you built up experience and expertise on what worked as the medium matured.  It would have been a lot easier to be successful if you started at the very beginning when you could pay a lot less and you could gain the experience to find what works.  Now, it takes a lot of money to jump right into radio and TV advertising. 

That is what is going to happen to online marketing and the fact that we went from $0.10 a visitor to $3 a visitor indicates.  Only the "rich" and those who have built up the experience will be able to compete in the market.  You could continue to advertise in your Yellow Pages or do some simple brochure mailing, but these are dying mediums that are being replaced by online marketing.  They will look much cheaper but in the end, you will get what you paid for.

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