Understanding Pay Per Click PPC Search Engine Marketing

Search Engine Marketing through use of Pay Per Click (PPC) ads is an effective method of placing any website in front of prospective clients without having to optimize or market the website. Companies with new websites, extremely old websites or websites which offer multiple services in multiple locations are best serviced through use of pay per click marketing. Search Engine pay per click marketing (Google AdWords, Yahoo Search Marketing, Microsoft bCentral) is typically setup with a daily and/or monthly budget for the marketing campaign.

In traditional advertising marketers charge for a specific location in a magazine or newspaper in hopes that someone saw the advertisment based on a distribution number created by the company selling the advertising. This left much to be desired since the company selling the advertising was the same company providing the customers with the ‘distribution numbers’ estimating how many people might see the magazine or newspaper and hopefully view the advertisment inside of it. There was no true way to judge how many people saw the advertisment or what the return on investment was for the ad campaign. Online advertising, specifically pay per click (PPC) changed things with the pay for performance method of costs.

With PPC advertising a company only pays when the advertisment they show on the search engine is clicked on and a prospective customer is taken to the website to view the customer. When a customer simply views the ad on a search engine, without clicking, then there is no cost to anyone. Advertisers may setup a daily and monthly budget to spend for ads in addition to individual bids (yes bidding similar to ebay) for each search term or keyword phrase. A company or individual may bid for a particular phrase or set of keywords to have their advertisment show up when a search was done for those words on a search engine. The benefit is that advertisers pay for exactly what they receive while the detraction of bidding on keywords is that competitors can instantly outbid each other driving the costs up dramatically.

This means that ten companies may bid for the keyword phrase ‘Kansas City Website Companies’ all spending $1 per click to show up in the first ten advertising locations on a search engine. When ten more companies decided to bid on the same set of keywords they outbid the first companies for $1.50 per click or 50% higher cost per click. When the first set of companies see they have been outbid and their ads are no longer showing then they bid $2 a click or 100% more for the same traffic. Bidding sometimes becomes extremely competative when people or companies target a specific keyword phrase with no limit on how high the bidding goes for each click.

The benefit of Pay Per Click is that companies never pay for the branding/marketing aspects of having online users view the ad unless the online user actually clicks on the ad (thus pay per click). Online marketers sometimes neglect taking the time to search for the best ‘bang for the buck’ when setting up PPC accounts for clients. Builder Consulting spends several hours consulting with the customer to determine the top keywords and phrases then sets a specific budget for each term based upon the overall monthly goals and cost per click likelyhood of a return on investment. Keep in mind that any account setup with a daily and monthly budget will not show all ads all of the time.

The rate at which ads are shown is based upon budgets, likelyhood of the ad delivering a click (more effective ads are shown more often), the number of advertisers paying for each search term and the remaining balance of a budget for each advertiser. Any individual or company can setup pay per click advertising in a matter of minutes, setting it up properly to requires experiance and an understanding of the overall concepts, goals and technical aspects of the systems to provide a true return on investment.

Robert ‘Dot Com’ Jackson
913-814-8844 Offices

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