Pay-per-click advertising is on my brain lately. It is a powerful Internet marketing medium that can bring instant results. But often "instant" does not translate to "effective."
For example, how do you measure the success of your PPC? Many people look at bid price, click-through rate, and total visitors. Are you measuring actual conversions from pay-per-click visitors? Yahoo Search Marketing and Google AdWords have tools to measure which pay-per-click visitors coming to your site are purchasing from you.
With conversion tools set up, look at your cost-per-conversion and your conversion rate. these can be more effective ways to measure PPC return on investment (ROI) than amount spent, visitors, and click-through rate.
I have seen examples where an advertiser's click-through rate may not be great, but its overall conversion rate for a given category or term is actually pretty good. I have also seen the opposite, where from a click-through perspective the category or keyword seems to be performing well but those visitors are actually not converting to sales.
Use the great tools provided by your pay-per-click vendors to measure pay-per-click advertising against actual sales.