PPC (Pay Per Click) advertising refers to online paid ads that generate clicks to a website. Each time an ad is clicked, the advertiser pays the publisher (the platform hosting the ad) an amount determined by an auction. If you're looking to get more clicks on your affiliate links or drive traffic to your website, a PPC campaign is a reliable way to achieve it.
This article covers the ins and outs of PPC, including tips on strategy and budgeting. We'll tackle how to set up your paid ad campaigns the right way and talk about using best practices to ensure success.
PPC advertising is an excellent way of boosting traffic to websites that may not have worked their SEO magic yet for the same keywords and phrases. In addition, it can be helpful to draw attention to promotions or sales if you are running an e-commerce website. Typically, PPC ads appear when people type relevant keywords and phrases in a search toolbar, be it a search engine or social media platform.
Clicks are straightforward to track, and you only pay for traffic directed to your site. With the most popular PPC pricing model, cost per click (CPC), you pay only when someone clicks your ad. Marketers often talk about 'buying clicks' because that's what PPC is all about. You're paying a publisher, be it Facebook, Google, or Bing, each time someone clicks a link pointing to your landing page.
Marketers often deploy PPC ads to appear at the top of search engine results pages and target people on social platforms. On Google's search results page, PPC ads appear at the top of the search results, above the organic links. They are the 'sponsored' posts on your Facebook feed, and the results marked 'Ad' on Bing and Google.
The idea is that people searching for keywords related to your product or service will find your ad, click through to your website/landing page, and complete the action the page is promoting. Clicks on social media platforms are encouraged by visually engaging ads targeted to the intended visitor.
In search engines, PPC ads typically blend in with the overall search results by look and feel. Here is an example of a PPC ad targeting the keywords "travel insurance" There is not much difference between the paid ads at the top of the page and the organic listing at the bottom.
There are a host of options when it comes to PPC advertising. The following are the most common types:
Paid search marketing
Paid search marketing refers to ads that companies show on search engines. Ads are listed in the sponsored listing section of the search engine or on a partner site, usually above the organic results. Advertisers pay each time people click on their ads. These ads are targeted based on a keyword list that the advertiser specifies. They contain specific, targeted keywords and direct users to a landing page.
With display advertising, ads come in a variety of mediums. Unlike paid search, banner ads rely on visual elements such as images, animations, video, and audio to communicate goals and drive clicks. Display ads generally return a lower click-through rate (CTR) than search ads, but they can be useful for companies looking to build brand awareness or retarget users who have visited their website
Social media advertising
Given the volume of people using social media platforms, sites like Facebook and Instagram are full of potential customers. With ads on these platforms, you can often target specific demographics with specific interests. This will help increase awareness of your products and services, bringing them to the attention of people most likely to be interested in them, helping you achieve a higher CTR as a result.
Retargeting PPC advertising
How much do PPC ads cost?
As the name suggests, PPC ads are charged per click. Some platforms, like Facebook, offer advertising on a PPC model as well as on a CPM (cost per 1,000 impressions). In the latter's case, an "impression" refers to each time your ad displays on someone's screen.
Using PPC ads for affiliate marketing
Affiliate marketers commonly use PPC ads to promote their products and services. Mostly, they place ads on:
Since affiliate marketing is based around cost per action (CPA) – when someone clicks on an ad and completes an action, such as buying something or providing an email address, payment is closely aligned with results. This type of marketing requires ongoing management to get the best results. Factors that can negatively impact this kind of PPC marketing include poor ad response, poor placement, and competitive keyword bidding for brand terms.
As we've established, advertisers use PPC to promote their products or services. They pay the publishers (Facebook, Bing, Google Ads, etc.) to display their ads, and are charged when they click on their ad.
The set-up process plays out as follows:
When someone types one of the keywords or keyword phrases into a social platform or search engine and clicks the "search" button, matching ads are displayed on the results page. If the searcher also clicks the ad, they are taken to the advertiser's website, and you, as the advertiser, are charged for the click.
A PPC campaign can be defined as a logical, organized approach to PPC advertising, and includes several elements:
The planning process for your paid marketing effort will encompass everything from budgets to timeframes and the list below.
One or more ads which target a shared set of keywords. Once you set a bid, an ad group keywords trigger an ad to appear. It is always a good idea to have your keywords match your ad copy when you are running a PPC campaign.
Determine which keywords are relevant to your business's offerings, and bid to place ads in the search results for relevant search queries.
The text and/or imagery that you use to advertise your products or services.
Where people are directed to when they click on your PPC ad.
It doesn't take much to get started mapping out your first PPC campaign, but the following four things are essential:
PPC, like any other marketing effort, requires establishing business goals before anything else. With PPC, these goals are particularly important because they guide the structure of your campaigns. For example, you could structure your campaigns by user intent, how far users are in your marketing funnel, etc.
Your first task is to decide on what you want to achieve with your paid search effort. Is it to build awareness and consideration among prospects? Generate leads? Sell products? Increase average order value? Upsell existing customers? Increase loyalty? Drive app installs or in-app actions? Whatever your goals are, map them out and refer back to them often.
While it might seem obvious, PPC advertising requires you to spend money to make money. Without an adequate budget, your ads won't display very often. To understand how much money you need to invest to be highly visible on your most relevant keywords, most platforms offer keyword research tools. You can use these to estimate demand and average CPCs for the locations you want to target.
When someone clicks on your ad, you need a place to send them to. Each time users click on an ad, they should be sent to a dedicated landing page with specific goals and instructions (making a purchase, email capture, etc.), rather than just your website's homepage. It doesn't matter how good your ads are if you don't have useful landing pages.
Your campaign's complexity and the size of your budget will dictate how much time you need to dedicate to managing, analyzing, and optimizing it. Contrary to popular opinion, PPC requires work, and it's an incredibly easy way to waste money. You need to devote the right amount of resources, whether it’s you personally or by employing talent. This will be fruitful in the long-run.
Once you've got a handle on creating ads on your platform and your paid search campaign is up and running, it's time to take charge of the tasks required to run a successful program. Keeping on top of your performance and reporting is a no-brainer as a best practice. Most search marketers perform a daily check to make sure nothing has negatively affected their account, such as budget running out or KPIs spiking or dipping too much.
Similarly, handle optimizations and testing. Check regularly to tweak certain bids, especially for terms that constitute a large portion of your budget. Shaving a few cents off a bid could achieve the same performance and save you some extra to reinvest in another campaign. You can also take advantage of automated bidding policies that platforms now offer. However, make sure you understand your goals clearly so that you do not overpay.
Here are some of the areas to focus on:
With PPC it's possible to target niche markets in highly competitive industries. If you can discover the topics, keywords, products, and services with high demand and low competition, you'll benefit from the most affordable CPC rate.
Many shopping campaigns run on PPC platforms. Users search for a specific product and are presented clickable images of exact matches at the top of their search results. If someone clicks on your product listing, they are directed to your site's product page to close the sale.
Quick PPC wins include increasing sales and revenue and site visitors. You can see the results very quickly compared to other forms of advertising and easily tweak elements to get better results. It's common to continually A/B test landing pages and their ad copy, for example (which we'll talk about later).
With PPC, you pay each time someone clicks on your ad. The price is determined by the market value of the keywords or expressions you're interested in targeting. The vast majority of CPC/PPC marketplaces operate on an auction bidding model where advertisers bid on these keywords. Favorable ad placement isn't always necessarily determined by how high your bid is, but how relevant it is to users.
When someone searches online, the platform they are using will find all the ads with matching keywords. Ads that are not eligible will not show, such as those that target a different location, for example. Of the remaining ads, only those with a high ad rank may show.
"Ad Rank" refers to the position of a PPC ad on a search engine results page (SERP). The key components of a higher ad ranking are relevant keywords, landing pages, and ad text.
Your ad rank determines whether your PPC ads will appear in SERPs and where it will appear in the SERP. Having a high ad rank is essential because it will result in greater exposure and a higher CTR for your ads.
The quality score is a measure of how relevant a keyword is to the auctions in which it participates. This metric is used to help show the most relevant ads to users when a search happens. The quality score plays a significant role in determining the positions of your ads in search results. Most PPC platforms use your quality score to influence your ad rank and the price you pay per click.
Each platform has a different way of determining the quality score. Irrespective of the PPC platform, the components that make up quality scores are pretty similar. All will factor in expected CTR – the likelihood someone will click on your ad; ad relevance – whether the ad copy relates to what the user is searching for; and the landing page experience – if your landing pages reflect the search query that bought someone there.
There are several platforms on which you can place PPC ads. The most popular options include Google Ads, Microsoft Advertising, Facebook, and YouTube. Here's a bit of information about each to help you determine which platform best suits your needs.
Google handles the majority of the Web's search queries. As such, they are the authority on generating traffic through paid ads. It might seem that using their advertising platform, Google Ads, is a no-brainer, no matter what niche you're in, but that's not entirely the case.
Google Ads is great for increasing traffic to your website and tapping into potentially large amounts of volume. Still, there's also a substantial amount of competition because everyone is fighting for a higher ranking position on the search engine's platform.
To see a profit from your Google Ads campaigns, you need to take on the competition with a strategy in place and a solid idea of your budget limitations. That said, Google Ads is a fantastic platform for gaining traffic and targeting customers for websites promoting less-common products.
Google Ads tools are designed to give marketers a tight reign over their advertising spend. In a few clicks, you can adjust your campaign, spending more if it's working particularly well, or cut back to spend less.
Advertisers use Google Ads to target people searching Google for solutions. To get this right, there are variables you can fine-tune in the dashboard, starting with keywords. You can set up many qualifiers based on geography; it is very helpful if you have a limited shipping area.
Let's say you run a Men's Suit Tailors in lower Manhattan and want to reach potential customers there. You can limit your ad to appear in neighboring Zip Codes 10002, 10003,10004, 10005, 10006, 10007, 10009, 10038, 10280, etc. You can run your ad at certain times of the day and play around with different ad types (shapes) or messages to see which converts best.
Google Ads is probably the first port of call for most PPC advertising, but don't overlook Microsoft Advertising. Microsoft Advertising is the platform advertisers use to place ads on Bing.com, AOL, and Yahoo. Advertisers can also place their ads on the Bing Syndicated Partner Network, which includes sites like:
Bing is no small presence in the digital world, with approximately 15 billion searches each month. Around 11% of online searches happen on Bing. When running ads on Bing, you can reach 936.5 million unique searchers across the Bing network (May 2020).
Bing offers some surprising advantages. While it can't compete with the amount of traffic that Google gets, it's an option for advertisers who want to expand their reach, and it can sometimes offer lower CPCs for the same keywords.
The main benefit of the Microsoft Advertising platform is that it's less competitive than Google Ads. The typical cost per click on Bing costs 33-42% less than it does on Google Ads. Additionally, it offers more precise targeting options. With Bing, you have more 'geo-control,' so you can get even more specific about who is being targeted to see your ad.
Search volume is the biggest difference between Bing and Google. Otherwise, the platforms are both so similar that if you are already using Google Ads, you might as well use Bing. While Google Ads will bring in the bulk of your traffic, Microsoft Advertising will help you reach a broader audience.
The mechanics of advertising on Bing are virtually identical to Google Ads. Even if you're new to paid search, Microsoft Advertising is still easy to use. The platforms are so similar that you can sync your Google Google Ads campaigns directly over to Bing.
For more information on getting started with Microsoft Advertising, refer to the official Microsoft Advertising help site. Microsoft provides a comprehensive resource with real-world examples and "how-to" articles and videos for getting started and guides to features that boost campaign performance.
As far as advertising on social media is concerned, Facebook is where it's at. Facebook is more than a social media network for keeping up with your old friends. It's evolved into one of the most powerful advertising platforms, with 2.32 billion monthly active users (as of December 31, 2018). Its dominance in social media makes it an excellent tool for promotion through paid ads.
Unlike paid search advertising, with paid social networking ads, you can get more specific with your targeting. With Facebook, you can target the demographics that are likely to be interested in your products or services. You can use the site's tools to narrow your audience based on criteria like language, age, gender, geographic location, and more.
Facebook's ad delivery system works on an auction structure. It runs automatically to determine which ads will be seen in a user's feed. Facebook ads serve two goals: creating value for advertisers and providing a positive and relevant experience for end-users
The system is not based on a traditional auction system that works on a "highest bid wins," but what ads are the most valuable. Facebook determines an ad's total value based on three factors: your bid, the estimated action rate, and the ad's overall quality and relevance.
You have two bidding methods: lowest cost and target cost. The lowest cost is an automated bid where Facebook bids on your behalf to achieve your desired result. Alternatively, the target cost tells Facebook to achieve a goal. This approach is more manual. Find out more with this in-depth guide to Facebook how bidding works at Smartly.
This is the likelihood of someone taking action through your ad. The ad itself and the post-click experience are important factors. Facebook's "estimates" are based on historical ad performance and the previous actions of the demographic you are attempting to advertise to.
Is your ad going to be interesting to the people seeing it? Facebook looks at user feedback to determine this. Poor feedback will decrease the overall value.
YouTube offers several types of ad formats, all of which are managed via Google Ads. They range from video ads that appear before content to display ads alongside videos to text ad overlays within videos. In addition, there are ads called Discovery Ads which function similarly to paid search ads, but in which you link to your video content. YouTube ad budgets are managed just like search ads budgets within Google ads, but not all YouTube ad formats use keyword targeting like traditional search ads.
According to a survey by Tubular insights, in 2019, 80% of traffic on the Internet will come through video. That's a hefty amount of traffic to miss out on if you don't consider video for your PPC strategy.
There are one billion users on the platform; there is potential to reach a huge number of highly engaged people.
Being part of the Google empire, YouTube has a wealth of user data that only Facebook can rival. Data regarding individual preferences and interests can help you target the right people.
YouTube provides in-depth reports on the performance of your campaigns.
People tend to respond well to YouTube ads; the average conversion rate on YouTube is 14%. You might be surprised to hear that with Facebook, it's just 10%.
Just like Google search ads, YouTube ads are mainly charged on a CPV (cost per view) basis, so you only pay when users view all or a portion of your ad. The typical spend for a YouTube ad view can range from $0.01 and $0.23. Although this may seem cheap compared to the cost of a click via Google search, consider the expense of producing video content to run in your advertising.
The cost of making video ads can be off-putting to marketers and small businesses alike. Unless you have the capital to invest, you might not see the type of revenue you'd expect in return from search and social media advertising.
Chances are you don't have an unlimited budget for your advertising. Even if your niche is wildly profitable, all businesses have cash flow constraints. With PPC, you will want to allocate the right amount of your budget to each campaign.
One of the critical things to understand about budgeting is that limiting budget isn't the best way of going about things. It's controlling spending. The starting point in determining your account is figuring out how valuable a lead, sale, or email address is to your business.
When we talk about goals, we mean, how do you want to see your business to grow? Let's assume you run a home furnishing store, and you want to increase profits. Your average profit when an order comes in is $100. You also experience one sale for every ten visitors to your site. If you set a maximum CPC bid of $10, then on average, you’d have to spend $100 on ad clicks to earn $100 of profit, or simply break even. So for your business to be profitable, your CPC must be less than $10.
You should calculate the return on investment of your ad campaigns in order to understand the relationship between spend and return. The basic formula for return on investment (ROI) is:
ROI = Net Profit / Total Investment * 100
With PPC budgets, it's common to set a daily spend level. This is an average amount, not a maximum. It's possible that you experience days when your daily budget isn't met, and other times when you've overspent the daily budget. Most PPC platforms balance your budget out over a month. With this system, you won't spend more than the daily budget multiplied by the average number of days in a month. This way, your campaign will take into account any spikes and lulls in daily search activity.
There is also a Shared Budget option available in both Google Ads and Microsoft Advertising. Available from the Shared Library, Shared Budgets allow you to allocate one budget across multiple campaigns. The search engines will automatically adjust how the budget is allocated. If one campaign underspends, the leftover daily budget can be used by other campaigns.
The first step to launching a PPC campaign is deciphering what your customers want and how they are searching for it. Begin by looking at your landing page to decide what your main keywords are. Then, it's time to work out the search terms your visitors might use. Google’s Keyword Planner and Google Trends are excellent resources for this. The Keyword Planner allows you to directly import your plan into your Google Ads account and start running it.
Your keywords will be related to your products or services, but what if your customers aren't finding your products using the keywords you target? Your entire campaign will be a bust.
Keywords are central to any PPC campaign, so it's worth taking the time to get this right.
Before we start, let's define the difference between keywords and search queries.
Keyword – the term you are targeting
The exact term you are targeting in paid search. For example, if you want your ad to show up when users search for an Electric Kettle, then Electric Kettle is your keyword.
Search query – what users type
This is the actual word or string of words that someone types into a search engine. If they are looking for an electric kettle from Bosch, it could be something along the lines of 'Electric Bosch Kettle Black 2ltr', or 'Bosch Electric Kettle Sale'.
Take a look at the diagram below. There can be a pretty significant difference between queries and keywords:
Grouping and organizing your keywords improves your PPC strategies by enabling you to create:
The first step is to whittle down a set of keywords into a few main groups. If you've done proper keyword research, you've likely got quite a few to play with.
Begin by creating groups of keywords that drive the most traffic and conversions. These will form the basis of your top-level keyword groups. They should be broad; the idea is to build up a taxonomy or hierarchy. After these are established, you'll branch out general groups into more specific subgroups.
Your business offering will determine top-level keywords. For example, say you own an online clothing shop with a sizable shoe section. Let's say your best performing organic keyword is "sports shoes." Notice the overlap between these keywords. You need to determine which term is more characteristic of what you are selling: sports or shoes?
The answer here is shoes. There can be a huge number of search queries related to the word sports, but they won't be relevant to your business. In this case, shoes will be a strong top-level keyword group. When you create your first group of keywords, more promising top-level groups will become apparent. There are broad categories of shoes that are a safe bet, such as sneakers and sandals.
Create smaller, more specific subgroups of keywords.
Now that your top-level groups are decided, it's time to segment them down into smaller, more targeted subgroups. This tier usually contains a modifier, such as a brand name or any other salient detail. A second-level group for the "shoes" keyword might include occasions and styles. For example, "running shoes" or "wedding shoes." These modifiers tell you what kind of shoe it is. The figure below shows a keyword group tree for shoes.
You might start with a simple account structure like this.
then an extended version that looks something like this
Another subgroup of keywords to factor in are those which reveal the intent of potential visitors. Think about the way you search when you are thinking of making a purchase. What kind of words do you use?
In marketing speak, we categorize the deepest levels of intent with orientational terms. These are terms that help us understand how interested our searcher is in an offering. Orientational terms include transactional, investigative, and instructional words or phrases.
Refer to the following as a guide:
|Transactional||Buy, purchase, discount, cheapest, where to buy, coupon, subscribe, for sale, sale||Make purchase|
|Investigative||Why, review, compare||Inform purchase|
|Instructional||How to, tutorial||Find resource|
As we’ve illustrated, segmenting your keywords is the basis of a successful and cost-effective PPC campaign from end-to-end. Identifying groups of keywords that are relevant to your business allows you to create a strong structure for your PPC campaign from day one.
Once your PPC campaign is set up, it's important to measure your performance consistently. By continually assessing your keywords and adapting your tactics, you will learn how best to optimize campaigns for maximizing return on investment.
To optimize your paid ads, factor in the following:
To maximize your conversion rate (whether that be the number of people who make a purchase or sign up to your mailing list, etc.) make sure your landing pages are well-designed and closely aligned to the ad. This will also keep your CPC down. Search engines reward the most relevant ad so eliminate content that the user doesn’t need to see when they are trying to decide whether to purchase your product. Pages you create for SEO purposes with extra text may not be helpful in your PPC campaigns.
Not tracking conversions is akin to driving in the dark without headlights. How else are you going to determine the success of your digital advertising programs? Fortunately, with PPC, conversion tracking is simple and logical. Work out which keywords are driving sales at low costs and optimize around them.
Are you receiving the right kind of traffic? The bounce rate is an indicator of how relevant your keywords are. Checking your quality score will give you clues as to whether your ad and landing page are as relevant as they should be. If your quality score is low, it will impact on clicks and CPC. Luckily you can see these scores within Google and Bing Ads easily and make corrections to improve them.
Prepare your ads so that each ad group can link to several ad copy versions. Test which is working best and shelve the ones that aren't performing. You can also look into A/B testing, which is when you change your ads' single elements and analyze which version gets the best responses. The headline, copy, or call-to-action are the right places to start. A/B, or split testing, is another topic in itself; see our guide to measuring your online marketing for advice on how to A/B test your ads. In Google Ads, you can now add multiple headlines to your ads and allow the engine to use machine learning to determine which one to show to users based on performance, saving you from the manual effort of A/B testing yourself.
Is your campaign delivering on your marketing goals? Have you achieved what you wanted with your paid ads? When running a PPC campaign it is important to stay on top of your budget. If you’ve allocated a certain amount of money to your campaigns, create a budget pacing document in a spreadsheet to track your actual vs. planned spend.
If you've just launched your PPC campaign, you may need to wait until you have some results before tweaking your spending strategy.
Every major search engine offers extra tools and support to help manage your campaigns. Familiarize yourself with their advice and stick to it. Google Ads Help Center is exhaustive, and you can also post a question to the community to get answers from the experts. Similarly, YouTube offers many helpful contents to help you create a compelling video ad, even with just a smartphone. You can also talk directly with a video ad expert when you spend $10 on the platform per day.
When starting off running a PPC campaign, there are many mistakes which can prove very costly, especially when advertising on Google, where competition is high. Bidding without first taking into account your business goals and profit margins can blind you into losing sight of their budget, and in the worst case, paying more per click than your break-even cost. Let's say your Google Ad receives 100 clicks per month, and each click costs you $0.18. Your total cost for these clicks is $18.00. Let's assume you make $6 for each item you sell; you need to have three clicks to convert to a sale to break even.
Thinking long term, PPC should be one of several channels in your overall marketing strategy. Even if your PPC campaign provides you with a quick bump in traffic, as soon as you stop bidding on keywords and your campaign ends, your traffic is likely to dip back down. Therefore, if you have a PPC campaign which is driving good results for your business, it makes sense to keep it running as an “always-on” campaign.
With this in mind, you should utilize PPC as an always-on solution when you find that it helps you achieve your business goals, in tandem with other marketing strategies. In some cases, you can test turning your PPC ads on and off for specific keywords and ad groups if you find that you suddenly rank very highly for the same keywords organically.
As it can take some time to build organic traffic from SEO, but paid ads can provide more immediate results, making PPC a great supplement to your SEO efforts. Recent studies also suggest PPC brings in more qualified traffic. Visitors guided by an ad are 50% more likely to purchase something on a website they visit than people who find the same site via an organic search.
Handle PPC with quantifiable short-term goals, unlike SEO, which is a long-term, multifaceted strategy of managing your website content in order to optimize search visibility. Instead of relying solely on PPC (a more expensive option long term), the optimal strategy for PPC is to use paid ads to supplement your organic efforts as you improve your website.
Effective website content management includes elements to boost a site's visibility in search engine rankings to ensure your site is optimized to the latest algorithm. Have you submitted your site so that it is indexed, for example? Is your content designed with SEO in mind? Is it easy to navigate? Have you made efforts to increase the quality and quantity of links pointing to your site? There are myriad things you can do to gain favor in organic search, which will help your paid efforts.
The reason that so many online marketers use PPC advertising is fairly simple: it's a flexible form of advertising that can be used to drive qualified traffic to your website. As long as you have a clearly defined goal and strategy, take the time to budget wisely, choose the right keywords, write good copy and create impactful landing pages, you can increase traffic, compete online, and use paid search to grow your business.