What is PPC and How does it Works in Digital Marketing?

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PPC

PPC

PPC advertising or Pay per click supports your organic growth online and is also the fastest way to convert more sales for your business (when done right). In this blog, we will look at what PPC is, how much it can cost you and how it works. We will also share some tips at the end, because PPC advertising can be a costly mistake when done wrong.

Pay per click (PPC) is a model of online advertising in which the advertisers pay each time someone clicks on their ads. In short it a way to buy traffic to your site. PPC has also come to be known as keyword advertising, search engine advertising, paid SEO etc. These are all names of advertising on the internet. Let us dive deeper into what PPC is.

What is Pay Per Click?
Think of traditional advertising that is popular since last one hundred years. Marketers pay hefty amounts to put an advertisement in television, hoardings or a newspaper because they expect a lot of people to see the ad and know about their product and services.

With the number of internet users crossing 3.77 billion, the world wide web presents a huge audience where marketers can place their advertisements. Search engines and websites draw large amount of visitors and online advertising lets marketers put their ad on these sites.

You must have seen the ad results that come up on Google search when you search for a term.

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These are ads placed by advertisers for which they pay Google a certain amount. In case of PPC, model advertisers pay Google every time someone clicks on the ads. Ads can be placed in search engine results like above or even on popular blogs and websites like Forbes.com, CNN.com and YouTube.com. Ads can be text, images or even videos like the ones we see on Youtube.

What are the platforms for PPC?
You can place ads on Google by opening an account in Google Adwords. Adwords is Google’s platform where you can set up ad campaigns and place ads in Google search results or google network sites. It is by far the largest and most commonly used PPC platform used. Similarly, Bing and Yahoo have a platform called Bing Ads.

Facebook and other social media sites also use PPC advertising. There are also sites like Taboola that can place your native ads across popular websites.

How much does PPC cost?
A click on your ad can cost you anywhere from $1 to $50. Your ad campaigns will target keywords that are chosen by you. This means that the ad will show up in the search results of the keyword chosen. It can also show in sites related to the particular keyword. The word ‘casino’ is one of the costliest keyword and costs $ 55.48 in Google Adwords.

The keywords chosen must be relevant to your business and something that a customer would type when looking for your services or products. For eg. If you are law firm based in New York your keywords should include ‘lawyers in New York’, ‘legal assistance’, ‘legal consultant’ etc. The ad spend depends to a large extent on your keywords chosen.

How Does PPC Work?
PPC advertising starts by setting up an ad campaign. Your ads will start showing up once the campaign is made live after selecting keywords and setting ad options. There are many settings in Adwords that let you target your ads to relevant audience. Here are some terms to familiarize you with the workings of paid online marketing:

• Search network and Display network: – You can chose either or both to advertise on. Advertising on search network will show ads on search engine result page and advertising on display will show ads on websites and blogs related to your keyword chosen.

• Targeting: – You can chose to show your ad only in particular location (geo – targeting) or during particular time of the day(ad scheduling). You can also choose to show your ad only on a particular device such as mobile.

• Remarketing: – Show your ads to people who have visited your site recently.

• Bidding: – There are various options when it comes to submitting bids. You could choose to pay per click on your add (CPC), pay per thousand impression of your ad (CPM) or pay for each sale converted (CPA). Do a research on the competitive pricing for your keyword in keyword planner, set your daily budget and you are good to go.

Let us look at how platforms decide which ads to show.

Ad Auctions
Ad platforms like Google Adwords and Facebook Business) decide which ads to show up on search page. The ads shown are not just a result of bids submitted but they are result of following factors taken into consideration:

1. Conversion rate – This is calculated by your past click through rate (CTR), quality of landing page.

2. Ad relevance – Google wants to show ads that are relevant and useful to its searchers. Hence they rank better ads text matching the search query higher. Quality of landing pages and user experience is another factor that determines ad rank.

3. Bids Submitted – Finally the bids submitted are taken into consideration. Most of the platforms have a second price auction meaning you only have to pay a penny more than your next competitor.

Here is a video by Google Adwords explaining how they determine ad rank.

PPC advertising is one of the fastest way to get sales converting online. However, there are many nuances of advertising online. Making profit from it can takes months and sometimes years of learning. Here are a few things you must keep in mind before jumping into PPC advertising:

• Keyword research – Keywords are can make or break your ad campaign. Use tools like keyword planner to select the right keywords. Avoid paying for non-converting by including negative keywords. Find out the related keywords and keywords with good buying intent.

• Manage Budget – It is very important to manage your budgets effectively. There are many big players in the market that spend a million per month on PPC advertising. Focus on long tail keywords and use targeting tools to get to niche markets.

• Optimize landing page – Make sure your landing page of the ad is well suited for conversion. Landing page should be simple, to the point and relevant. Many marketers spend money on clicks but do not see the conversions happening because their conversion process is not smooth. Make it easy for the visitor to purchase.

• Choose your Platform – As discussed above there are many platforms and ad networks to place your ad. Some are better suited to your product where as others may turn out cheaper for you. An in-depth research of customer buying pattern would help in narrowing down the right strategy for you. Facebook ads are much cheaper with a more targeted ad placement as of today.

64.6% of people click on Google ads when they are looking to buy an item online. (WordStream, 2016). PPC ads allow you to get high conversion traffic to your site. However, setting up a campaign and managing it requires a level of expertise. PPC ads can be a money making activity once you get the hang of it.

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