How Does Pay-Per-Click Advertising Work?

Pay per click (PPC) advertising is a type of online advertisement when that you only pay when a user clicks on your ad, which typically takes them to your website. It could also take them to a landing page or social profile. PPC is a direct/action–oriented form of advertising that helps you target your customers with specific terms related to your business.

PPC also has great technology that allows you to track how customers are reaching you and see how many customers you are generating from your ad. In this article, you’ll learn more about the ins and outs of PPC and how you can get better results from your online ads.

Where Do the Ads Go?

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With a PPC campaign, you can target designated keywords on the major search engines Google, Bing, and Yahoo. For a very basic example, if you sell “widgets” in Boise and a person is on Google searching for “Boise widgets” and you have a PPC ad, your ad may appear at the top of the results of page 1. This is also called paid search.

Google has recently made changes to how it display paid search results. You can learn more about that here.

If you opt to do display advertising or remarketing, ads may also appear on websites in the Google ad network (which can number in the millions or you can designate which sites you want your ads to appear) that have topics related to your desired customers that are part of the Google Adwords program.

How Much Does It Cost?

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Google AdWords is constantly running auctions to determine the amount users you will pay for PPC bids. It takes into account your text ads, keywords, and bidding and determines your ad rank through a ‘Quality Score’.

For example, if you had a Seattle car insurance agency, and you wanted to bid on the keyword “Seattle car insurance”, your advertising campaign would likely be significantly more expensive on a per click basis than a business bidding on the term “Ballard barber shop” as there would be significantly more competition, bidding, and value placed on a term relating to car insurance, which can cost thousands of dollars a year, than a barber shop that may charge $15 a haircut.

Fluctuating Prices & Bidding

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The prices for clicks varies based on supply and demand. The more you bid, the more likely you will get a higher ad spot but there is much more science to AdWords than just a high bid. What’s important is getting a positive ROI and having a high quality score.

AdWords is a complex advertising platform. Your ad copy, keywords, click through rates, and more to determine your ad rank. The good news is you can set limits on the price you will pay so you can control your spending.

Being skilled in AdWords and knowing its many ins and outs can take years so it’s best to leave AdWords PPC set up and management to a Google Certified professional. They’ll knows best practices and how to structure and optimize your ads to get better results.

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