I've said it before and I'll say it again: any process which includes, as one step, "Start an AdWords campaign" tests your ability to work AdWords more than it tests anything about your market, customers, ability to craft a landing page, etc etc.
"This validated my earlier finding that [search engine marketing -- by which I think they mean exclusively CPC ads] might not actually be a viable distribution channel for CloudFire."
No, it did not. It only proved that, today, you were not able to create a profitable AdWords campaign.
I can't bang on this enough: AdWords doesn't have a skill curve associated with it. It has a gentle skill slope followed by a 1,000 foot-tall basalt monolith slicked with ice, guarded by ill-tempered yeti, and governed under rules of physics different than the rest of the world which change constantly and cannot be disclosed to you.
For example, trust me on this: there is much, much, muuuuuuch cheaper inventory available for those keywords. (Check the content network. You'll be amazed.) The blogger just wasn't getting it because ahem it is not in Google's interest to give everyone cheap inventory when they could be overcharging them for worthless Youtube page views.
Isn't the content network clicks generally of much lower quality? The idea being non-content network clicks come from people proactively searching while content network is more passive.
Content clicks are of much lower quality, but for selling things to middle American housewives, there are many, many content clicks which are really search clicks.
Are you familiar with about.com, Demand Media, et al? Here's one inch on the basalt monolith: they get the overwhelming majority of their traffic directly from Google, and exist so that they can get a click on their AdWords ad. Classic arbitrage -- Google should hate it but, well, after you reach a certain scale the rules that can't be disclosed to you change.
Thus you get a frequent scenario such as this:
1) Customer Googles some keyword of value with a very, very high CPC. Say, [halloween bingo], which probably costs in the vicinity of $2-$3 on Google. (I don't know because it is higher than where I could profitably monetize it, but I have a general idea of where the ceiling should be.)
2) Customer lands on a page on about.com. The page is garbage and does not satisfy the customer's desire.
3) Customer clicks on the first thing they see which advances their interests -- an AdWords ad. Because content clicks are severely undervalued, that click costs 6 cents rather than $2, even though it is essentially a search click.
One of Google's many dirty little secrets is that the Content Network is essentially a second bite at the apple for getting folks to click on AdWords ads when they didn't on the SERP.
Ah I hadn't thought of that, which is kinda stupid considering I have a site that gets thousands of adsense clicks with >75% of them coming right out of a google search.
I haven't used adwords much. Can you target content networks to very specific domains or pages within domains?
patio11 - The reason a lot of people start with AdWords is exactly because the learning curve is low and there are some reports of success using it. However, as people have learned to work AdWords, I'm afraid such reports are getting far and between, and you can very quickly loose yourself in it.
Our goal was not to work AdWords to pull bunnies out of it, but rather to drive a little targeted traffic so we could test. We got much more utility out of usability testing and talking to real customers. I also think there is a lot more low lying fruit to be picked before resorting to working AdWords.
I don't see the chicken & egg problem. This article pretty clearly showed that he was able to learn about user's needs with only time, persistence, and money
"This validated my earlier finding that [search engine marketing -- by which I think they mean exclusively CPC ads] might not actually be a viable distribution channel for CloudFire."
No, it did not. It only proved that, today, you were not able to create a profitable AdWords campaign.
I can't bang on this enough: AdWords doesn't have a skill curve associated with it. It has a gentle skill slope followed by a 1,000 foot-tall basalt monolith slicked with ice, guarded by ill-tempered yeti, and governed under rules of physics different than the rest of the world which change constantly and cannot be disclosed to you.
For example, trust me on this: there is much, much, muuuuuuch cheaper inventory available for those keywords. (Check the content network. You'll be amazed.) The blogger just wasn't getting it because ahem it is not in Google's interest to give everyone cheap inventory when they could be overcharging them for worthless Youtube page views.