Microsoft AdCenter

Pay per click advertising was around for more than five years before Microsoft finally entered this hot business. It probably was a mistake on Microsoft's part, the delay cost them.

The currently supreme king of all things pay per click is the Google Adwords program. But Microsoft is trying hard to make up for lost time. They have the technology, money, clout, and capability to catch Google.

What exactly is Microsoft AdCenter? In a nutshell, it is an online advertising vehicle for companies or individuals that want targeted web traffic. A company can build their own advertisement, the title, the verbiage, make the offer and then have that ad be a link back to their website.

The company (the customer of Microsoft) then picks which keywords they wish the advertisement to appear with. If a company was selling baseball gloves, then they most likely would choose several baseball related keywords for their ad. When anyone searching MSN searches one of those keyword phrases, the customer's advertisement will appear next to the search results. If the person conducting the search clicks on the advertisement they are taken to the webpage of the customer and Microsoft collects a charge for getting a potential customer to their client's website.

This is pay per click advertising. Microsoft will show your ad next to their search results, for terms that are relevant that you get to pick.

How much do companies have to pay to get listed in search results? Technically, nothing. To get the ad to appear, that is. If anyone performing searches clicks on your ad, then Microsoft will charge you.

How much will Microsoft charge if someone clicks on my ad? It really depends, mostly on how popular the topic you are advertising is. If you are putting up ads about baseball gloves, then you will not have to pay too much because the competition is low, the demand is relatively low and a completed sale of batting gloves doesn't generate that much total revenue for any company.

If on the other hand you were advertising something very expensive and extremely popular, then the keywords could be very high priced. Say for instance you were a divorce attorney and wanted Microsoft to display your advertisement anytime someone searched divorce on MSN. Many other attorneys will have ads in this search result, the price of divorce is very high and the demand is always present. This means any ad that is clicked on for this topic will be far more expensive than the batting glove advertisement.

The difference could be as staggering as 20 cents versus 14 dollars. The disparity is there mainly due to supply and demand. In addition the cost structure of the end product is represented as well. Something that costs $10 to purchase will inevitably have a lower per click cost than something that has an $800 cost.

The base price for any ad appearing on the Microsoft AdCenter network is 10 cents per click. Microsoft will always collect this much no matter what.

Microsoft AdCenter ads mainly show up on the MSN search engine, which lately gets the term Microsoft Live Search. Yahoo has Yahoo Marketing (which used to be Overture) and they tend to be rated low in the pay per click world.

The real king that both Microsoft and Yahoo are trying to compete against is Google. The Microsoft AdCenter program is largely derived (basically copied) from Google. Although, to their credit, Microsoft did add a few improvements which Google in turn copied. One of the standouts that AdCenter came up with is the concept of Day Parting. This is when an advertiser only wants his advertisement to appear for certain parts of the day. For example, a company that engages in discount brokerage services may only want their ads to run during normal trading hours. They could choose the window of time that their ads show up in search.

The Microsoft effort to enter pay per click advertising is a position that Microsoft usually doesn't find itself, which is far below their competitor. At the same time, Microsoft has a lot of reserve cash and they are pushing AdCenter hard. Heavy advertising, free trials, a high quality technical platform, great customer service, and bonus sign-up money all are contributing to a steady growth. AdCenter has a bright future and Google will need to compete to stay on top of this lucrative and fast growing industry.