PPC is an abbreviation for Pay Per Click advertising. PPC was introduced by Overture’s founder Bill Gross in 1998 as a concept paper at an industry convention. The idea was adopted and introduced by Yahoo later that year. In 2002, after seeing the growing success Yahoo was getting from PPC, Google changed their Adwords program from a cost per thousand impressions to a PPC format. Like they say, the rest is history.

What is PPC Marketing?

PPC is an advertising method that lets you run classified style ads on the search engine results page. The ads are served from a database server. Each time a user clicks on one of the ads to visit your web site you are charged for that click. There are two distinct types of PPC ads: keyword match and context match. Keyword match ads are displayed on the results page of the search engine. The server matches what it displays to the keywords the user typed into the search bar. The advertiser is charged each time a user clicks on their ad. Context match ads are displayed on the websites, in newsletters and HTML emails of webmasters that become ad publishers by opening an account with the search engine that allows them to display ads. Again the ads are matched to appropriate keywords for the media on which they are being displayed. When a visitor to the publisher’s website or reader of the newsletter or email clicks on the ad, the publisher is paid a small percentage of what the advertiser is charged for showing the content sensitive ads. PPC is a results based marketing method because you are only charged if someone clicks on an ad and visits your website. All of the major search engines offer PPC advertising. The biggest players are Google Adwords, Yahoo! Search Engine Marketing, Microsoft AdCenter, Ask, LookSmart, Miva and Baidu.

How PPC Works for the Marketer

A seller must first create an account with the search engine that allows him to bid on keywords so he can place PPC ads. You can bid on a specific keyword or keyword phrase related to your product. If you bid the highest amount, your ad will be the first one listed for that keyword. All of the search engines place paid ads above and to the right of the organic search results. The picture below shows the MSN result for a search on “ski poles”. PPC Marketing on MSN The ads in the yellow box and the ones along the right hand side are PPC ads.  If you click on any of the PPC ads, the advertiser will be charged for your click.

PPC Advantages

The primary advantages of PPC Marketing are:

  • PPC allows the advertiser to decide how much money they want to spend on keyword based advertising. The higher you bid on a keyword or keyword phrase, the greater the probability of your ad being on the first results page.
  • You are only charged when someone actually clicks through to your website.
  • PPC ads pre-qualify your visitors because people who click through are already interested in what you have to offer
  • PPC can generate immediate traffic to your website
  • You can start or stop your campaign whenever you want to which gives you much greater flexibility that most other advertising methods

PPC Disadvantages

The primary disadvantages of PPC are:

  • Keywords can cost from a few cents to more than $10 a click
  • If your ad is too general you could get thousands of curious visitors so unless you can set a spending limit for each ad, you can pay a small fortune for meager results.
  • The major search engines distribute a small percentage of their traffic to the smaller search engines which can cause you to get duplicate traffic or traffic that never had any intention of buying your product.
  • Measuring your rate of return can be difficult even with the tools provided by the major search engines
  • The more traffic you receive, the more it costs you which is not a problem as long as your ads generate a reasonable percentage of visitors who buy your product.

Conclusion

PPC marketing is like any other paid advertising method. It should be one of the many different marketing methods you employ and should primarily be used for special promotions, new products, new websites and in very narrow niche markets. PPC marketing is good starting point to quickly find the keyword phrases converting visitors to buyers, once you know which keyword phrases make you money it is a good strategy to start an SEO campaign and try to rank high for these phrases – free organic traffic tends to convert better, so the benefits are two folds:

  1. Once your site is ranked high in the search engine listings, you don’t have to pay for the visitors coming to your website.
  2. Those visitors will generally purchase more often than those coming from your PPC campaign.

Search engine optimization can be a lot of work initially but it can pay off with free traffic for many years to come and should be a part of every marketers long range marketing plan. Do you want powerful SEO tips? Subscribe to my newsletter, I will show you how you can automate a lot of the tedious tasks and get top rankings faster than you thought possible.


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