How Do Pay Per Click and Adwords Work?
Many people use search engines to get the information they need. If you’re one of them, you’ve probably noticed advertisements that are listed along with the search results. This has become common in popular search engines such as Google and Bing.
If you’ve noticed ads being listed along with search results when you make a query, then you’ve already come across PPC advertising. PPC is an abbreviation that stands for pay-per-click. It is an advertising strategy that allows advertisers to display their ads alongside search results for relevant keywords. The advertisers are only charged for their ads when a person clicks on the ads, hence the term ‘pay-per-click’.
How it works
In order to have your ads appear alongside search results, you have to choose relevant keywords. Your ads will appear on search results pages that come up from queries related to the keyword you have chosen. If for example you are selling tents and other camping equipment, you may choose the keyword ‘camping equipment’. Your ad will appear on a search results page made for a query with the terms ‘camping equipment’.
However, just having the right keywords doesn’t ensure listing. There are many other advertisers who also use the same keywords. Search engine algorithms use complex calculations in order to determine the ads that will be displayed on search results pages. These calculations also determine the order and which advertiser is given priority.
Advertisers pay the platform owner for every time their ads are clicked on. The amount paid will depend on what you bid for the keyword. Competitive keywords that attract a lot of bids attract high costs per click. While those that are not as competitive attract much less. You could therefore end up paying anything from a few cents to several dollars per click.
It is therefore important to set a budget and determine just how much you’re willing to spend on your advertising campaign. This will give you the figure to use as a bid. Remember that those whose bids are higher have a better chance of being listed on search results pages.
It is important for advertisers to remember that your bid isn’t the only factor considered when determining your listing. Search engines and other platforms also consider the relevance of your ads. They also consider the quality of your landing page as well as the click through rate of your ad.
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