Paid search has quickly become more than just another marketing tool; rather because of the far flung reach of such search engines as Google and Yahoo!, paid search keywords are in the process of remaking many long standing marketing concepts.

It's easy to see why: A paid search marketing campaign can give a business huge exposure not only to the millions of Google and Yahoo! users but also through the content and destination pages that participate in keyword marketplace programs. For an e-commerce site, these eyeballs are priceless. And they are more than just eyeballs -- usually people who click on keywords are already interested in the site and its products. They are more than just casual shoppers.

Or are they? Paid search, for all its benefits, at the same time presents marketers with some significant challenges -- challenges that can also frustrate an e-commerce operation hoping to use keywords to increase traffic.

For starters, an e-commerce site might have to use hundreds of keywords and phrase combinations to cover any one category -- each with its own audience and market appeal. Consider a site that sells high-end luxury goods for pets. "Pet supplies" is a relevant keyword. But so are "booties for dogs" and "fancy cat collars." Managing these various phrases -- and most important of all -- tracking which keyword brings in customers that actually buy a product –- can be difficult.

This "closed loop" challenge is not specific to keyword marketing techniques; indeed the inability to adequately track a campaign's effectiveness from start to end of sale is a very common complaint across all marketing mediums. Keyword marketing amplifies the problem with the multitude of keywords used in any one campaign -- a far bigger number than the number of print or online ads a company would typically use for a campaign. But because it is Internet-based, keyword marketing -- or rather -- key word marketing that is integrated with a true, closed loop marketing campaign application or process -- also provides a solution to this problem.

Google and Yahoo!'s keyword marketing networks provide basic reporting on a keyword's performance, such as click-through visitors to a site. What they don't provide is data on the conversion of those visitors to lead, prospect or closed sales, primarily because they do not match up with real time accounting and sales data.

Campaign management applications specifically designed for keyword marketing activities, by contrast, can do that. Leading systems will tie in with paid search marketing providers such as Google and Yahoo! and automatically generate destination URLs for each keyword combination. These systems incorporate data from actual sales with the tracking methodologies, allowing a company to rate the profitability, effectiveness, and ROI on each keyword combination. Going back to the simple example of the pet Website, the owner might find that while "dog supplies" brings a lot of traffic to the site, those few Internet browsers that click on "fancy collars for cats" are the ones most apt to buy a more expensively priced product.

The logical assumption would be that the owner would relinquish "dog supplies" and buy keyword combinations of its specific high-end pet products. And perhaps that may well be the winning route for this particular Web site. It could also be that "dog supplies" brings in such volume that even if only 1 percent of these visitors buy from the site, it is still a worthwhile investment -- perhaps even more important than "fancy collars." But without centrally managed information on keywords and keyword phrases as they have moved through the sales cycle, it is impossible to know for sure. Paid search technology can deliver that information to companies -- along with a wealth of other previously unattainable data to help entrepreneurs make the most of their precious marketing dollars.