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How does Pay-per-click advertising work?

April 14, 2011

in Search Marketing

Pay-per-click (PPC) advertising, also referred to as Cost-Per-Click advertising, is a method used by many search engine marketing companies to drive traffic to a website. PPC entails bidding on specific search terms (or keywords) that people might type into a search engine in order to find certain information. Winning PPC bids – which translate into high-ranking text ads on the search engine – provide excellent exposure for both new and existing websites. But how exactly does it work?

Pay-per-click explained

When a searcher types specific keywords (or search phrases) into a search engine, the search engine will separate the paid listings from the unpaid listings when calling up the results. Pay-per-click advertising is a paid listing. It is an agreement between a search engine and a business or advertising firm that enables the business to place a small ad on the right-hand side, or top left-hand side, of the results page, for certain key words.

Creating your PPC advert

The PPC ad on the search engine page usually has a title, a heading, and a short product description focusing on what is being marketed on the site it represents. Creating these ads is relatively simple. Once you have decided on the wording of your ad, you will need to pick your bid price. This is the price you will pay every time someone clicks on your pay-per-click ad on the search engine results pages (SERPs).

Determining your bidding price for PPC keywords

The number of other people targeting the category and search terms that you have selected will dictate how much you will have to bid. Generally, the more competitive your term(s), the higher your bid(s) will need to be. That said, however, it’s also important to bear in mind that the search engines will give your site a quality score based on the relevancy of your advert. The better the quality score that your site receives, the lower you will have to bid for relevant keywords.

What makes PPC so effective?

In some ways, pay-per-click marketing is similar to search engine optimisation (SEO). Keyword identification, competitive analysis and constant monitoring are required to streamline the campaign to achieve maximum return on investment (ROI) for minimum cost. The primary difference between SEO and PPC is that a pay-per-click advertising campaign is more likely to generate faster results for your website: Whereas SEO processes may take months to improve your site’s rankings on the search engines, PPC is able to generate measurable results within just days. PPC also makes it much easier to measure ROI.

Most pay-per-click services offer some form of tracking. This makes it possible for you to determine whether or not someone who clicked on your ad actually bought something – or contacted you, or answered your survey, or completed whatever you specified as a “lead”. This will help you to see which ads are effective and which keywords are bringing in the most revenue. In turn, this data will provide the information you need to tailor your ads to achieve optimum results.

PPC is not expensive to set up, and you can spend as much (or as little) as you like on your daily or monthly budget. Additionally, your ads only appear when someone searches with a phrase that you have identified as being valuable to your business. If you were selling building materials, you would use keywords such as “building materials”, “building equipment”, or more specific words such as “cement mixers” or “bricks”.

When a person searches for “building materials”, your website’s description and advertisement will appear on the SERPs, along with a direct link to your website. In other words, your ad is placed in front of people who are already looking for the products or services that you sell, which makes them far more likely to purchase them than someone who stumbled onto your site accidentally.

PPC gets you noticed fast!

The quickest way to use the Internet to promote your products or services is through pay-per-click-advertising. PPC makes it possible for your adverts to appear in high ranking positions on the SERPs in a short amount of time.
Contact Purple Cow for a tailor-made Pay-per-click strategy for your business.

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