What Is PPC & How Paid Search Marketing Works

What Is PPC & How Paid Search Marketing Works

What Is PPC?

Pay-per-click (PPC) is an advertising model that allows marketers to place ads on an advertising platform and pay the platform’s host every time an ad is clicked.

The purpose of a PPC ad is to direct people who view the ad to click through to the advertiser’s website or application, where visitors can complete valuable actions, such as buying a product.

Advertising services like Google Ads and Bing Ads operate with real-time bidding (RTB), where advertising inventory is sold in a private automated auction using real-time data.

How Paid Search Works

Whenever there is an ad slot on the search engine results page (SERP), the keyword is immediately auctioned.

Multiple factors, including bid amount and ad quality, determine the winner that will appear at the top of the SERP list.

These auctions are the driving force behind PPC.

When someone searches for a product on a search engine, the auction begins. If an advertiser is interested in showing ads related to a user’s search query, an auction is triggered based on the keywords that the advertiser bids. The ad that wins the auction will then appear on the search engine results page.

To participate in these auctions, advertisers use accounts on platforms such as Google Ads to set up ads and determine when and where they want to show them. Accounts are split into campaigns for ease of management and reporting of different locations, product types, or other useful categorization.

Campaigns are further divided into ad groups containing keywords and related ads.

Keywords

Keywords are at the center of PPC and connect advertisers to users’ search queries.

• Queries are the actual words that users type into the search box of a search engine in order to find results.
• Keywords, on the other hand, are what marketers use to target these users by matching their search queries.

Keywords are a generalized abstraction of a broad search query and are prone to irregularities such as misspellings.

Advertisers can more or less exactly match search queries based on the type of keyword match they use. For example, advertisers can choose to match keywords with search queries exactly or to allow for variations such as different orderings of the words, different spellings, or the inclusion of other words.

You can also use negative keywords, which will prevent search queries containing those keywords from triggering your ads, and thus avoid irrelevant traffic.

Ads

In addition to keywords, you also need to prepare ads in your campaign.

These ads are nested within ad groups for shared keyword sets, and are therefore organized by common theme.

Ads are what users see when they win an auction, so it ’s important to do it right.

They typically contain a:

• Headline.
• URL.
• Description.

On SERPs, they can be displayed at the top of the results or at the bottom of the page. It ’s best to test different versions of your ad copy to see what works best.

Services like Google Ads and Bing Ads provide features called ad extensions to enhance the look of your ads.

Examples include:

• Sitelink extensions, which populate an ad with more links to different pages on a site.
• Call extensions, which add a phone number to the ad during business hours.

Ad extensions are great because they increase the visibility of your ads by making them more engaging while communicating more information with them.

Budgets & Bids

In order to bid, advertisers need to determine how much they are willing to spend for a given keyword. This is done using the following command:

• Budgets at the campaign level.
• Bids at the ad group or keyword level.

The budget is set at the campaign level and can exceed the budget each day, but not overrun each month. Your budget should be based on your overall account strategy, but bidding is a more precise way to control spending.

All ad groups must have bids, but keyword-level bids override ad group-level bids.

Because of the use of a real-time bidding system, the amount an advertiser actually pays depends on the competition’s activity and ad position, not just the maximum bid.

Ad Rank

Winning an auction is not just about the highest bid.

Search engines consider other factors to determine which ads should be on top of the SERPs and where they are most valuable.

Search engines have their own particular ways of factoring in other elements to determine ad rank. Google, for example, considers:

• Bid amount.
• Ad relevance and quality.
• The context of the search (such as the user’s device and time of day).
• Format impact (whether it includes extensions that enhance the format of the ad).

Quality Score is a metric that determines ad relevance. The components of Quality Score are:

• Historical click-through rate (CTR).
• Relevance of the keyword to the ad.
• Relevance of the keyword and ad to the search query.
• Landing page quality.

Ad relevance is absolutely essential; the higher Quality Score is, the lower the CPC will be.

Search engines penalize advertisers who bid on keywords with lower Quality Scores, and rarely show their ads, even with higher bids.

That’s why it’s important to have engaging and relevant ad copy with a large number of keywords. However, the quality of landing pages can’t be ignored; they show less often when ads point to sites with poor user experience.

The page must be relevant to the user, load quickly and provide an overall smooth user experience on all devices.

Targeting

Choosing the right keywords allows advertisers to show their ads to relevant audiences.

But there are other targeting options available to optimize campaigns, including:

• Device.
• Location.
• Day and time.
• Demographics.

In this way, advertisers can target users who use mobile devices at night or users under 25 years of age in a specific radius to optimize their advertising performance.

These targeting options are useful because, for example, different variations of ad copy may perform better for one group of users than another.

Remarketing tools that allow more specific ad copy messages and budget adjustments can also target or exclude past visitors to your site for subsequent searches.

You can automatically adjust your keyword bids based on your targeting options to give advertisers more control over traffic and spend by bidding when customers are more valuable to your business.

Conversions

The purpose of all this hard work is not just to get clicks.

The real end goal is conversion.

A conversion is what an advertiser wants users to complete when they click on an ad, and it depends on the type of business being advertised.

Common examples of conversions include:

• Purchasing a service.
• Signing up for a newsletter.
• Placing a phone call.

Tracking conversions is important so you know how well your PPC campaigns are performing and how many conversions can be attributed to paid search rather than other marketing channels.

Platforms such as Google Ads can use a piece of code placed in the source code of the conversion page to track conversions (the code arrived after the conversion, such as the thank you page) to collect conversion data.

Conversion tracking can be tricky, as conversion paths tend to be more complex than simple clicks on ads and direct purchases.

They often include multiple searches and website visits, or can lead to email, phone or brick-and-mortar visits.

Using an analytics service like Google Analytics can help you decide how to distribute credit for conversions in your conversion path.

Resource from : https://www.searchenginejournal.com/ppc-guide/what-is-ppc-paid-search/#close