How Branding Affects Online Advertising Costs

Have you ever thought about how much of a difference “BRANDING” makes when someone is buying advertising online? What makes Google the best search engine for pay per click marketing? Yahoo and Bing are still getting BILLIONS of search results every month through their sites, but Google advertising comes at a much higher premium. Go one level deeper and look at search engines like 7Search… cost per click pricing is just a fraction of what it costs to advertise with Google.

When it comes to search engine marketing, quality is king. No advertiser is going to spend a ton of money on advertising if the leads aren’t backing out for them. Though the issue of volume is also one that Google has over other brands, even when against Yahoo and Bing combined.

Another way to look at branding and how it influences ad cost is to look at a site like TechCrunch. The ad rates on this site are quite amazing. Companies that want to advertise on TechCrunch are most likely paying what they are paying because they want to be associated with the TechCrunch brand. They could definitely reach the same audience through different outlets at a much lower rate.

TechCrunch advertising packages start out at $5,000 – and they have such a demand for advertising on their site, that they created a cool infographic that is posted on their sales page. (Doesn’t this make the process of buying ads on their site that much cooler, versus just an order form page!)

But this is nothing new… 

Just look at the clothing and shoes you are wearing right now. What type of car in in your drive way… and how many of you are reading this on a Apple product right now?

The reason why people will pay more money to be associated with world famous brands is because they WANT to be associated with that brand that makes them feel better, blend in with the “cool” crowd or are sucked into the massive marketing campaigns that drive up the costs for many of the products of these large companies.

For example, a $20 sweater from KMart or Old Navy will probably keep you just as warm as a $200 Ralph Lauren sweater. It might not have the same quality and look, but in the end it still serves the same purpose. Yet there is still a massive demand for the Ralph Lauren “brand” and the stigma that it offers to it’s consumers.

So what can we learn form this?… two different things:

1. Online advertising is greatly affected by branding, but not on all levels. Pay per click marketing is more influenced by the market and what keywords are being bid up to. On site advertising however is heavily focused on the type of site you are buying ad placement on (higher CPMs)
2. If you are going to be building your own company or web site, you should be focusing on the overall brand of your organization. A brand will grow with your company and customers overt time and can become more valuable than the actual revenue being done through your site. Branding is more than just what someone sees, it’s also how passionate they are about a product and the reputation that is behind that brand.

At the end of the day it doesn’t matter what your personal preference and buying habits are, it’s just important for you to understand the power of branding and how it influences the mind of your customers and makes them want to pay more to be associated with your BRAND.