Pay Per Click (PPC) Advertising on Search Engines
My last article on Digit Magazine about Search Engine Optimization received an overwhelming acceptance among some of the readers, and I thank everyone who contacts me via Twitter and email. In fact, SEO is becoming a widely discussed topic in Sri Lanka, and many local businesses are using Search Engine Optimization with a great level of expertise, which is a good trend in Sri Lanka. I hope I solved most of your SEO problems to the maximum I’m capable of.
From Search Engine Optimization; this issue we move onto another form of search engine marketing. This time we will discuss in detail about ‘Pay Per Click Advertising’ or PPC as we commonly refer.
When we say Pay Per Click advertising on search engines, we actually talk about the ‘Sponsored Links” appearing on your search engine result page.
PPC becomes handy, when it is highly competitive for you to reach the top ranks in organic results. For example, if you want your site to appear on top 5 organic results for the keyword “Cricket World Cup” you will have to compete with over 57,100,000 web pages, which requires an enormous SEO efforts. But, if you have a budget to spend; you can easily buy spot for you in the ‘sponsored links’ section of the SERP quite easily.
PPC advertising is by far the most widespread form of pay-for-performance search marketing. As it’s the most effective way for a search engine to make money, PPC is offered by almost every SE on Earth. However, the two most prominent providers of PPC advertising are Google and Yahoo.
Google AdWords is the world leader in pay-per-click advertising. Currently it has more than 150,000 advertisers. The ads show up not only with Google search results, but also with Google partners such as AOL search, About.com and thousands of other websites that publish AdWords ads. Google has an interesting ad ranking system. It ranks ads not by the bid (the amount their owners are ready to pay for one click), but by the combination of the bid and the click-through ratio. This way, Google maximizes its revenue stream (since Revenue to Google = Bid x CTR x Views) and gives small advertisers an opportunity to effectively compete with big companies. A small advertiser cannot compete on the cost-per-click basis, but can successfully overcome any big company in terms of the click-through ratio.
AdWords ads can only contain 95 characters: 25 for the headline, then two 35-character-long description lines, and a visible URL field.
AdWords gives advertisers several options to target keywords: broad matching, exact matching, phrase matching, and negative keywords. The matching options define how close the search string entered by a user should be to a keyword selected by an advertiser. If the advertiser has chosen [cricket bats] as their keyword (square brackets mean exact match), their ad will be shown only if a user enters tennis ball into the search box. If the advertiser has chosen “cricket bats” (quotes mean phrase match), the ad shows up if a user searches for heavy cricket bats or used cricket bats or simply cricket bat.
Yahoo! Search Marketing Solutions http://searchmarketing.yahoo.com (formerly Overture) is the second top player after Google in the field of PPC advertising. Overture (originally called GoTo) was the first company to offer PPC advertising and was later acquired by Yahoo. Yahoo ranks ad listings exclusively based on the bid amount; furthermore, if you get a top-3 listing with Yahoo, your ad will be prominently placed with MSN, Altavista, CNN, and other search and news portals.
A PPC model is an excellent source of income for any search engine. Therefore, almost every search engine offers PPC advertising opportunities. Among the more prominent PPC Engines are:
I personally suggest anyone who is interested in PPC marketing, to start with Google Adwords. It’s easy to understand, and comes with a user friendly interface and a campaign structure.
Some key indices that you have to pay attention when doing PPC marketing are,
- Max CPC Bid – Amount we are willing to pay maximum per click
- CPC – Cost Per Click: Amount we actually spent per click
- Average Position (Rank): The average rank at which our ad is displayed on Google sponsored listings
- Impressions – No of times our ad delivered
- Clicks – No of clicks we got
- CTR – Clicks as a % of impressions
- C/R – Transactions as a % of clicks
- EPC – Earning Per Click: How much did you earn per click?
- Cost Per Transaction
I believe, this article covered some basic introduction into what PPC advertising is, and how you can start campaigning on Google Adwords. In the next issue, I intend to focus on ‘Email Marketing’