If you’re new to the world of paid advertising then it can seem very daunting at first. With so many techniques, strategies and jargon to learn, knowing where to start can be difficult. From not knowing what keywords to target or how to write ads, many people give up at the first hurdle.
But little do they know that they’re missing out on one of the most powerful online advertising methods out there.
When learning about paid search it’s important that you always get the basics covered first. There’s no point learning about quality score if you’ve never made a campaign before. And there’s certainly no point learning about PPC strategies if you’re a complete newbie. Before you venture into the advanced topics of PPC it makes perfect sense to tackle the basics and lay the foundations on which you can build upon.
To bring you up to speed with PPC advertising, we’ve put together a helpful guide to give you a solid idea of how the whole thing works. Not matter if you’re a business owner looking to increase your sales or if you’re just starting the journey of becoming a PPC specialist, learning the basics is essential.
To get things started we’re taking a look at what PPC advertising means, and it’s definition. From there we’ll dive deeper into the advertising model and how the pieces fit together, including the most popular networks and benefits of using them.
So grab a pen or open up OneNote and prepare yourself for an educational ride into the world of PPC advertising.
What Is PPC Advertising?
The first thing we should get out of the way is what PPC actually stands for. If you managed to get this far without stumbling across its full name then that’s pretty impressive.
If you haven’t managed to work it out by now, then you should know that PPC stands for pay per click. It’s not exactly a secret and doesn’t mean anything different, it’s just obviously a lot quicker and easier to say (and type) PPC instead of pay per click.
As you can probably make out from the name, it implies that someone pays for every click that they receive. Although that is a basic explanation of the PPC advertising model, this is also probably a good time to take a quick look at the PPC definition.
Pay Per Click Definition
Pay per click can simply be defined as:
An internet advertising model used to direct traffic to websites in which advertisers pay a publisher whenever their ad is clicked.
The important thing to note here is that there is an advertiser (the business who has a product or website to be promoted) and a publisher (the person or network which displays the ad on their site). Once the publisher puts the advert on their website and they start receiving clicks, the advertiser will be charged for every click they receive. The price they pay per click can depend on a range of factors including the popularity of the keyword and competition amongst other advertisers. Since the PPC model uses a bidding system like eBay, whoever pays the most, gets the most clicks.
Let’s take a closer look at why advertisers would want to use this model over say cost per impression models, and why publishers would sell their precious traffic in the first place.
How Does PPC Advertising Work?
The pay per click advertising model has been around since the early 90’s and has been continually tweaked by various businesses for over 20 years. The early versions of the PPC model saw huge backlash from advertisers who didn’t particularly want to pay for every click and preferred to pay a fixed fee every month instead.
However, once advertisers actually gave the model a go they were very impressed by the amount and quality of the traffic it provided. Unlike traditional advertising methods, pay per click marketing allows advertisers to focus their marketing efforts on specific users who are searching for certain keywords. Since PPC advertising is commonly found on search engines, if someone is searching for insurance then displaying ads about insurance to them is a great idea.
Nowadays there are several variations on the pay per click advertising model with most of them being used on social networks and search engines. If you’ve ever typed a keyword into Google and seen ads like this:
Then you’ve probably experienced and even interacted with Google’s pay per click advertising service.
Every ad you see in this picture is being paid for by a company (known as the advertiser). The publisher who displays the ads, which in this case is Google, receives money from advertisers every time a user clicks their ad.
From looking at data from Google’s own Keyword planner tool, the average advertiser pays £5.16 per click on the keyword “car insurance”, with the highest cost per click being £12.30. Considering the keyword receives over 358,000 clicks a month, over £1,800,000 is being spent every month by advertisers on this keyword alone. When you think about how many other keywords there are out there, that’s a lot of money!
Google Pay Per Click Advertising
Although there are plenty of different PPC networks out there, the biggest one by far is definitely Google’s pay per click advertising service. Also known as AdWords or now simply Google Ads, Google’s PPC network was launched in 2000 just a few years after the search engine itself.
It might not have been the first PPC network to hit the market, but since it’s release it’s grown to be the most popular and dominant by far.
As of June 2018, Google makes 86% of its total revenues from trading advertising inventory through its AdWords service. Considering Google had a total revenue of $109 billion in 2018, that’s a lot of money from pay per click advertising!
However, just because its the most popular doesn’t mean that its the only one out there. In fact, there are plenty of other PPC networks which can also provide impressive results for advertisers. Sometimes other networks are even more cost-effective as you don’t have anywhere near the amount of competition from other advertisers.
Other PPC Networks
Some other popular PPC networks include the likes of Bing Ads which is run by Microsoft and Facebook Ads which are run by the social media network Facebook.
Facebook Ads are an interesting network as they don’t revolve around a search engine. Instead, they work a little differently when targeting users.
In this example, the adverts are displayed to users based on information collected about the individual’s profile. This includes things such as the pages they have liked, the pages they have visited and other things listed on their profiles such as age, gender and location. Unlike search engines that only focus on keyword searches and the intent of the user’s search, Facebook ads target a whole demographic category instead.
This has both its pros and cons which can great for some advertisers, but nowhere near as effective than AdWords for others.
It’s also important to understand that advertisers use PPC advertising for different reasons. Not everyone is just trying to increase their amount of sales. Here are some of the top reasons advertisers and businesses use PPC advertising in the first place.
The Role of PPC Advertising
To Increase Brand Awareness
No matter if you’re a small business or large multinational corporation, making sure people recognize your brand is crucial. If you show anyone the Pepsi or Coca-Cola logo then they’ll instantly be able to tell you the brand even though they both sell very similar products. What’s more amazing is that although 99% of the world already recognize these brands they still spend millions on advertising every single year.
With PPC advertising, brands can get lots of exposure when people search for keywords related to their brand and the products they sell.
In the example above, the watchmaker Jaeger-LeCoultre is running PPC ads on the keyword “watches”. Every time someone searches for watches the first thing they’ll see is the advert from the company with reinforces their brand name and makes users aware of their products. When it comes to increasing your brand awareness and exposure, PPC adverts do a fantastic job.
To Generate More Leads / Sales
One of the most important roles of PPC advertising is driving more leads and sales to businesses. Let’s face it, if companies are spending thousands of dollars a month then they should expect to make a return on their investment. The only way to do this is by generating more sales and leads from their PPC advertising.
With access to millions of searches from millions of users every single month, PPC advertising is an excellent way for businesses to boost their sales with little effort. If you have the money to invest in PPC advertising then there’s a good chance you’ll make a healthy return.
Improve Advertising Efforts
Considering how popular and effective PPC advertising is, many businesses and advertisers are using it to boost their overall marketing efforts. Compared to the traditional advertising methods such as billboards and TV advertising PPC advertising can quickly improve traffic and sales to your website.
With the ability to setup an entire PPC campaign in just a couple of hours, many businesses are starting to add PPC advertising to their arsenal while decreasing their budget on other methods.
Expand Your PPC Knowledge
To learn more about pay per click advertising and how to create your own killer campaign, be sure to check out the other topics in our PPC Academy. From the essential basics all the way up to advanced techniques, learn everything you’ll ever need to know about PPC advertising completely for free.