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DIGITAL CLARITY: Understanding Pay Per Click advertising

Defining how paid search works

I have outlined the steadfast importance of search engine optimization and discussed the necessity of having an effective strategy in place that will help your business be “found” online, an essential step to success.

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Among the myriad of online marketing channels available to businesses, another area to pay important attention to is paid advertising – particularly Pay Per Click (PPC).

Similar to SEO, PPC is the model used to increase and improve the quality of traffic driven to a web site from search engines. However, unlike SEO, PPC uses paid services and the results can be found at the top of the results page in the highlighted box and in the right column. These results are labeled “sponsored links” or “sponsors sites.”

PPC is a unique system that allows advertisers to pay search vendors (e.g. Google, Yahoo!, Microsoft Bing, etc.) only when a searcher clicks on their ad. Advertisers bid on specific keywords or keyword phrases that are relevant to their target market.

PPC advertisers use a variety of strategies to ensure that their programs will generate quality leads from their clicks. It is important to note that each ad click may not result in a lead, but provides a visit to a site that is built with the intention of converting that click/visit into a lead or a sale. By understanding how each vendor’s platform or ad system works, PPC advertisers are able to create quality content that garners high ad placement, ideally on the first page of results.

As with SEO and most marketing and advertising efforts today, the goal of a PPC program is to increase visibility of your product or service on the Internet. By increasing visibility (i.e. placing online PPC ads), an effective PPC program will increase the number of visits to your web site. If your landing page (the page on your website that your ad directs searchers to) provides quality content that is tightly related to the ad clicked, then the probability of creating a quality lead from that click will increase. Using analytics tools, such as Google Analytics, Yahoo! Web Analytics or similar paid services is essential to properly tracking conversions and evaluating Cost Per Lead (CPL).

While SEO is focused on how sites are built and positioned on the Web, PPC is centered on how programs are built. Your overall PPC program or account can be broken down into campaigns. Each campaign has its individual goal and can be organized based on your web site structure, a theme, product, brand, etc. From there, campaigns are broken into ad groups, which also have a common theme, product, brand or goal. Then, each ad group has specific, tightly-knit and logical keywords. Within each ad group exist specific ads that are written with the call-to-action, ad group, keywords and landing page in mind.

Finally, as an advertiser paying for clicks, bid rates can be selected at campaign, ad group or keyword levels. This provides advertisers with control of how much they are spending on any aspect of their program. Another cost-effective feature is the ability to control or cap daily spends on each individual campaign per hour, per day, per week or per month.

Conceptually, this process is straightforward and relatively easy. There are, however, dozens of factors and strategies that go into making programs run smoothly and generate the best results. In order to manage an effective PPC program, it is essential to spend time every day evaluating and adjusting your campaigns—the marketer’s dream of having the ability to affect your advertising and marketing in near-real-time is now a reality.

Don’t forget, the overall goal is to generate quality leads that will result in a return on investment, just like any offline or online marketing channel. Strong keywords, quality ad copy, higher placement on the results page and relevant content on the landing page will result in not only more traffic, but can produce better leads. Remember, having a strong call-to-action with a valuable offer or promotion is also vital to the success of your campaign.

A PPC campaign will improve your business’s online marketing performance in the short term and can be modified and scaled constantly, unlike SEO where changes to your placement may take between two to three months.

Brandy Woolford is an Internet consultant at SteadyRain. A graduate of Saint Louis University, her diverse communications background has included work in primetime news, public relations, media relations and online marketing. www.SteadyRain.com or brandyw@steadyrain.com.

Comments

wrestlemaniac (anonymous) says...

This is really interesting, thanks for trying to explain it all. My question is not about the company who is trying to advertise, but rather those of us who have websites. Are those "Google Ads" worth it to put on your website? How does someone who has a website go about getting these PPC ads on their website? And has anybody tried this? Do they work? I have been enjoying learning all about the internet through your column Brandy.

January 15, 2010 at 10:24 a.m. ( | suggest removal )