Monday, January 12, 2009

What Is PPC Advertising Anyway?

By Alex Plana

The term PPC is short for Pay-Per-Click, and is now one of the most popular forms of internet advertising. Online ads appear in the form of text or images, and are displayed on blogs, search engines, and websites. Advertisers compete for and bid on keyword phrases. When their ads appear in search results and receive a click, the advertisers are charged for each click.

There are many PPC advertising networks but the most common are Google AdWords, Yahoo Search Marketing, and MSN adCenter. Google is the most widely used because of their ability to deliver significantly more ad impressions than any other search engine. To advertise on Google, an advertiser will typically pay more in Cost-Per-Click (CPC) compared to the other search engines.

The cost an advertiser pays for a click is dependent on type of keywords being targeted. Typically, higher traffic keywords result in higher CPC and less traffic keywords have a lower CPC. Keyword costs will be different from one advertiser to another due to the variety of factors that search engines use to help determine what an advertiser's minimum CPC should be.

How do search engines determine how much to charge? They will measure how relevant an offer is to the targeted keywords. Google for example, uses a Quality Score (QS) system that calculates how relevant keywords are to the landing page and ads being used. A higher Quality Score will help lower a keyword's CPC and increase ad position. Click-Through-Ratio (CTR) and Landing Page Relevancy are other major factors to improving Quality Score.

Most PPC ads are placed on the top right hand side of most Search Engine Result Pages (SERPs). They are typically identified or labeled as Sponsored Links, Sponsored Results, Sponsored Sites, or some similar description. The remaining section of a Search Engine Result Page displays natural Search Engine Optimization (SEO) results.

PPC is presently one of the most popular forms of online advertising. One of the main reasons is that advertisers only pay for actual clicks where the visitor goes to a designated site. Another important reason is that PPC campaigns can end up being displayed quickly in search results"often in minutes to a few days. This trumps SEO where several months can past before the same keywords receive ranking in search results. When executed properly, PPC can yield fantastic results for the bottom line of a business.

It is fairly easy to setup a PPC campaign in Google, Yahoo, and MSN, but to effectively execute a successful campaign may prove to be a tricky for most individuals. There are many factors to consider when trying to run a successful PPC campaign. The type of keywords picked is an important factor to a campaign's success. Choosing the wrong keywords can prove to be expensive and not choosing the right keywords is a missed opportunity. The way campaigns are structured, continuous testing, proper landing page creation, and bid optimization are other contributing factors to a successful PPC campaign.

Many successful companies are taking full advantage of the benefits PPC can offer; and branding and profit are at the top of the list. There are some people that can manage their own PPC campaign with limited success, but it is highly recommended to employ search marketing professionals who understand the business inside and out. The business of PPC is constantly growing, and with competitors entering the playing field daily, a business will need the latest search marketing techniques to stay on top of it's game.

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