There is an old saying about advertising that only half of it actually produces any results, you just don’t know which half. Many businesses don’t bother advertising because it is costly, difficult to analyse without significant research and doesn’t always bring in returns.

However, many online businesses would not exist if it were not for advertising. In particular “pay per click” advertising such as Google AdWords has been the saviour of many online companies. In the Daily Telegraph recently there were several examples of online businesses which were only able to succeed simply because of Google AdWords. These businesses were niche businesses which were able to find a small market thanks to advertising.

However, essential to the success of all these businesses was the fact that they analysed their advertising constantly and responded to changes in user behaviour. This is something that many businesses do not do. They stick up an advert and then take it down after spending hundreds of dollars with no results. Indeed, one company came to me after spending around $500 a month for three months and getting no sales as a result. They complained that Google AdWords was useless and how could they attract people to their web site in other ways.

In reality, their advert didn’t use any keywords that people were actually typing in. Equally, they only had one advert, which they never changed. Plus they didn’t analyse any of the data which Google produced for them. Their strategy was write an advert and hope.

Used together with Google Analytics, Google AdWords provides you with a powerful way of enhacing your online business. However, you need to allocate time for planning and analysis. Unlike advertising in the offline world, pay per click advertising can be highly effective is used properly. The problem is that most businesses do not analyse their advertising campaigns effectively. That may be less of a problem in the future as a new advertising model is beginning to take hold – pay per action. In other words you do not pay for the advert unless the readers of your adverts take your desired action – buying something! That is likely to focus many people’s minds on producing really good advertising.