Wednesday, October 31, 2012

How Pay Per Click Works

What is Pay Per Click?

Pay-per-click marketing is an advertising method that allows you to buy search engine placement by bidding on keywords or phrases. There are two different types of PPC marketing.

In the first, you pay a fee for an actual SERP ranking, and in some cases, you also pay a per-click fee meaning that the more you pay, the higher in the returned results your page will rank.

The second type is more along true advertising lines. This type of PPC marketing involves bidding on keywords or phrases that appear in, or are associated with, text advertisements. Google is probably the most notable provider of this service. Google’s AdWords service is an excellent example of how PPC advertisements work

PPC advertisements are those advertisements that you see at the top and on the sides of search pages.

Putting pay-per-click to work:

Now you can begin to look at the different keywords on which you might bid. Before you do, however, you need to look at a few more things. One of the top mistakes made with PPC programs is that users don’t take the time to clarify what it is they hope to gain from using a PPC service. It’s not enough for your PPC program just to have a goal of increasing your ROI (return on investment). You need something more quantifiable than just the desire to increase profit. How much would you like to increase your profit? How many visitors will it take to reach the desired increase?

Let’s say that right now each visit to your site is worth $.50, using our simplified example, and your average monthly profit is $5,000. That means that your site receives 10,000 visits per month. Now you need to decide how much you’d like to increase your profit. For this example, let’s say that you want to increase it to $7,500. To do that, if each visitor is worth $.50, you would need to increase the number of visits to your site to 15,000 per month. So, the goal for your PPC program should be “To increase profit $2,500 by driving an additional 5,000 visits per month.” This gives you a concrete, quantifiable measurement by which you can track your PPC campaigns.

Once you know what you want to spend, and what your goals are, you can begin to look at the different types of PPC programs that might work for you. Although keywords are the main PPC element associated with PPC marketing, there are other types of PPC programs to consider as well.

Source : Search Engine Optimization Bible By Wiley

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