How Does Pay Per Click Work: PPC 101
The ads that appear at the top and the right side of your Google searches have come a long way. They are no longer obvious, obnoxious or intrusive, as they were years ago.
This is partly why PPC ads are still so effective. In fact, those first three ads on Google’s searches got over 60% of all the traffic in 2013.
Facebook and Bing are likewise worthy investments because they all work the same way — ads that are purchased with target keywords are displayed for users who search using those words. That’s the simple answer to ‘how does pay per click work?’
Advertisers pay based on how many searches those words get and how competitive the market is. In 2015, there were over 4 million Google Advertisers.
So, How Does Pay Per Click Work?
If you decide to begin your own PPC ad campaign on Google, your first step is to set how much you’re willing to spend on ads.
How much those clicks cost, otherwise known as CPC (cost per click) will be determined by a number of factors: Ad Rank = Max CPC Bid x Quality Score.
We’ll talk about the Quality Score variable in a bit.
Regardless of the cost, when your budget reaches zero, Google pulls your ads until you’ve deposited more money.
At first glance, PPC may appear expensive, but you have to understand the impact that PPC ads can have on things like click-through-rates, conversion rates, and overall brand awareness.
In order to make sure you’re not throwing away valuable advertising dollars, you should really have a plan in place and know the in’s and out’s of PPC before investing.
This guide will help you understand some of the basics as well as advanced tips that go beyond answering the question: how does pay per click work?
Let’s dive in!
Set Goals Before You Start Paying
Start by going to the drawing board — lay down the foundation of your PPC advertising campaign.
Ask yourself questions like:
- What kind of milestones do you want to hit?
- What is your end-goal (is it more sales, more hits, brand awareness, all of the above)?
- How are you measuring your progress?
- Do you have lead capture forms, email sign-ups, phone/online purchases?
Knowing where you want to be next week, next month, and next quarter is how you stay atop of keywords, budgeting, and executing successful ad copy for your specific goals.
Have the Analytics Ready
A key method of tracking how does pay per click work is to make sure that all your tracking URLs are properly entered for you to view detailed paid search analytics.
Knowing how your traffic is moving will tell you what keywords work, which can change from month to month.
If you don’t have time to monitor and optimize your keyword management, you may want to hire a PPC service to do this for you.
Which PPC Platform Do You Choose?
PPC is offered on all major search engines, along with social media giant Facebook.
Each one can present a real opportunity to capture more views and more clicks, you just have to find out which one will provide the best value for your business.
Here’s how they stack up:
- Google gets the greatest number of users, but they are also the most expensive.
- Bing is growing, but still pales in comparison to Google’s search volume — you’re going to pay less CPC.
- Facebook is actively targeting users with algorithms that deliver ads that are relevant to their interests and/or recent social activity.
It’s not always clear which PPC platform you should use. This is where a PPC management service can save you some time and money when figuring out how does pay per click work.
Prepare Yourself for the Google Network
If you do decide to go the Google route, you’ll need to know which display network sites you’re advertising on.
As a first-timer, you should gradually add each network that will benefit you most, rather than all of them at once.
The Display Network will bring about a number of impressions by showing your promotions simultaneously over a huge number of websites.
If you’re not careful, the Google Display system could drain your advertising reserves rapidly and compromise your exposure.
The Display system can be powerful with precisely chosen words and advertisement content outlined particularly for this kind of promotion position.
It’s best to return to this strategy once you’ve understood introductory analytics from the networks chosen on how does pay per click work.
Local Searches can Produce Big Results
Another thing that you should look for when you first sign up on Google Adwords is localized targeting.
How does pay per click work on local searches? Your ads are seen by everyone in the country, but you’ll need to do some tweaking to take advantage of local competition.
If you’re based in a specific location, you’ll need to go into “Location Targeting” and customize accordingly. You even can set up your ad scheduling to coincide with your local time zone’s peak traffic.
Double-check which languages you want to target, as well. The better your demographic analytics, the more value you get for your CPC.
In Regards to Keywords
Your keyword choice will either make your PPC prosper or turn into a money pit. It’s imperative that you invest energy in recognizing the best keywords as they relate to your objectives.
With PPC you need to target purchaser keywords and not simply broad keywords that will wind up costing you cash without producing.
Improve your budgeting and keep your PPC campaign going strong by bidding with lower offers, rather than settling for the current rates.
The downside to this is that you may spend a lot more time trying to win those lower bids.
This is still not quite as effective as researching new keywords and finding new niches to capture. How does pay per click work in the long run?
Evolving your ad campaign includes finding a new long-tail keyword that gives you the edge and boosts your click-through rates.
Optimize Your Landing Pages
There’s one easy way to kill your PPC campaign, and that’s by setting up a defunct landing page. Page views produce no real conversions if your landing page isn’t set up properly.
Every step of the way, the viewer needs to be led through a seamless trail that leads to whatever your conversion goal is — new leads, a purchase, a sign-up sheet, etc.
Know Your PPC Budget
Planning ahead with PPC is crucial to success. That’s why it’s worth going over your budget a second time. You really want to nail down how much you want your customer acquisition cost to be.
If you’re not selling expensive products, then you need to watch how much you’re spending to bring in those clicks, so that your ROI makes sense.
PPC is Never Passive
No matter what tools or strategies you employ — you never want your campaign to run on auto-pilot.
You aren’t learning how does pay per click work just to set it and forget it.
No matter how refined your numbers are or how successful you are, things can change practically overnight. Loss of conversions will hit you hard if you don’t have someone managing your PPC campaign.
This is why SEO and PPC management services are such a great value. There’s lots of testing and strategizing how does pay per click work best for you.
Any small business can use this to their advantage. All you need is patience and smart strategies to improve low-quality ad copy, stagnant keyword targeting, and default bidding that is so prevalent.
Good Copy is King
The best-written ads attract a positive feedback loop that businesses online strive for. Great content gets shared more and stays relevant.
Learning how does pay per click work is only half the battle. Good copy results in higher CTR and improves your Quality Score.
This is how advertisers determine the best bang for their buck. You should never think about sacrificing your quality for quantity.
You can likewise improve your Quality Score by achieving higher CTR. There are actually ad extensions that you can get to customize the appearance of your ads.
Star ratings, thumbnail previews, price tags, and more can be added to make your ad stand out naturally and provide more information to the customer.
Optimization and Settings Tips
There are a number of settings in AdWords that you can use to quickly optimize your ads without needing much time or effort.
The geolocation settings, in particular, can allow you to focus on specific regions, including hours of operation, searchability on Google Maps, how it appears (phone, directions, menu), and more.
You can tell Google how large the geolocation region diameter from your location should be and what category/keywords you want to focus on.
How does Pay Per Click Work on Mobile?
Mobile optimization should also be a top priority, considering 70% of people who search on Google end up directly calling businesses.
That’s a very encouraging number for those who already plan on making mobile users their biggest targets. And for those who aren’t, you should be tapping into that market.
With the amount of Google’s volume sliding from desktop to portable significantly, your job should be to figure out how you can capture more mobile users.
An ever-increasing number of individuals are hunting down products and ventures as they go about their days on their phone. Some searches that start on a desktop are actually transferred, and completed, on a mobile device.
Portable CPCs, which were once at much lower costs, are climbing to reflect expanded activity and rivalry. Investigate your portable campaign to ensure you’re not losing cash on offers that are too high for your business.
Likewise, you can set mobile offers at either the group or campaign level, so you have a great deal of control over the amount you’re willing to pay for a mobile customer.
A Brief Word on Remarketing
After learning the how does pay per click work basics, let’s move onto an advanced PPC topic. Remarketing is extremely important for a long-term strategy to reach its full potential.
How does pay per click work if you can’t get conversions on first-visits?
Imagine remarketing like this: visitors landed on your page, took a few seconds to see what it was about, but didn’t pull the trigger on the sale.
This is seen as a loss, but like with many purchase decisions, sometimes the customer needs more time to think about it.
Remarketing is an effective way to get more value for your PPC campaign.
It goes hand-in-hand with social media marketing, raising brand authority, and all the slow-build strategies that reel customers in.
How to Hit the Ground Running
A strong PPC campaign can be challenging to master. There’s plenty of roadblocks and speed bumps along the way, especially if you go it alone.
But you don’t need to! There are plenty of talented SEO and PPC service providers out there that can help.
Any business looking to grow their PPC and improve their reach should consider PPC management service.
Contact us at Monster Media to learn how the latest PPC techniques can save you money while improving your click-through rates, conversions, and returns.
Our service will end up paying for itself in no time!