Pay Per Click: The Ultimate Guide to Streamlining Your Business

Safalta Expert Published by: Shivam Ray Updated Wed, 10 Jan 2024 11:02 AM IST

Highlights

Customers are 50% more likely to buy something after clicking on a paid ad.
SMEs spend $108,000 to $120,000 annually on PPC ads. 
57.5% of users don't recognize paid ads when they see them.
$35 billion was lost by online advertising due to click bots and fraudulent traffic.

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Pay-per-click (PPC) is an Internet advertising model used on websites where advertisers pay their hosts whenever their ad is clicked. With search engines, advertisers typically only bid on keyword phrases relevant to their target market.

  • Customers are 50% more likely to buy something after clicking on a paid ad.
  • SMEs spend $108,000 to $120,000 annually on PPC ads. 
  • 57.5% of users don't recognize paid ads when they see them.
  • $35 billion was lost by online advertising due to click bots and fraudulent traffic.

Content sites usually charge a fixed price per click rather than using a bidding system.

  1. The United Arab Emirates has an average CPC of 8 percent greater than the US average.
  2. Austria has an average CPC of 2 percent less than the US average.
  3. Australia has an average CPC of 5 percent less than the US average.
  4. Brazil has an average CPC of 11 percent less than the US average.
  5. The United Kingdom has an average CPC of 13 percent less than the US average.

Websites using PPC ads serve ads when a keyword search matches an advertiser's keyword list, or when a content site displays relevant content. Such ads are called sponsored links or sponsored ads, and they appear above or next to the results on the search engine's results page, or anywhere else on the content site that the web developer wishes.

Table of Contents

What is PPC

PPC means Pay Per Click, in this the advertiser has to pay for the click. That means, if you run your ads campaign and not everyone gets clicks on the ads, then you do not need to pay any money. You will have to pay only as much as you get clicks.
 

What Is PPC In Digital Marketing

The main objective of PPC is to bring visitors to your website.

Source: SAFALTA

Due to this, visitors can buy some products from the website or sign an email.

 There are two main platforms for using PPC.
  • Search Engine

  • Social Media

Let's look at both of them one by one :
 

Search Engine : 

If you want to target a keyword but there is a lot of competition on it, then you can use PPC.

When we run ads on search engines, it is called SEM (Search Engine Marketing). The most popular platform for SEM is the Google search engine.


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Social Media : 

Run PPC Ads Using Social Media  

Social media can be a very good medium for PPC. PPC advertising falls under SMM (Social Media Marketing) when it is run on social media.

Ads on social media are quite economical compared to search engines. By using SMM you can do good marketing even with less money. 

There are 2 popular platforms for SMM:- 

  1. Facebook

  2. Instagram

Apart from this, you can also use LinkedIn.
 

How to do PPC Ads work

In this, we will take the example of Google to understand how PPC works. Money alone is not enough to achieve top ranking in search engines. Apart from this, you have to pay attention to Quality Score, bidding, country, keywords, etc. By using all these you can get top ranking even with less money.


Bidding: 

Google Ads uses an auction system. In this, the advertiser has to bid for every keyword. The one who has more money gets more ranking or top position. This process is also quite complicated. If you have placed a bid of ₹ 10/- then it is not necessary that you will have to spend that much money for top ranking. Mostly it is less. Google, how much has the person at first and second position bid? Then if you want to get the top position, you will have to pay $0.01 more.
Example: The person whose ad is at number two has placed a bid of $10. You will have to spend $10.01 more to go above this. 
 


Quality Score: 

With a good quality score, you can now get top ranking even with less money.
The formula to calculate Ad Rank is:-
Ads Rank = (Quality Score) * (Max. CPC) 
For good ranking, both quality score and CPC (cost per click) need to be good.
CPC means how much money you want to spend on a click.
There is a formula to calculate Actual CPC called “Adword Discounter”.
Actual CPC = (Ad Rank Of Competitor/ Apna quality score) + $0.01

 

Importance Of PPC – Why run PPC Ads Campaign

After this, you might be wondering whether you need to run PPC ads. If this is the case then read below and all your doubts will be cleared.

There are 5 main reasons for running PPC ads:-  

  1. Get results quickly (Quick Result): If you want results as soon as possible then PPC can help you. You will start getting results as soon as you run your campaign. It is very difficult to do this through SEO. You will have to wait for months for SEO.

  2. Keyword Competition: It happens many times that there is a lot of competition for a keyword but you still want to rank. In this situation also you can use PPC ads.

  3. PPC remains under your complete control: With the help of PPC, you can show your ads whenever you want. You set the time and day in it and it will start adding. In this, you can also give a budget as per your wish. 

  4. Incredible Targeting Option: With the help of PPC, you can show your ad in any city in the country you want. You can even work out what kind of people should see your ad, what is their age, what is their salary, etc.

  5. You can easily measure PPC results: With the help of PPC, you can easily track and measure your results. Campaigns can also be optimized easily.

 

PPC And CPC In Digital Marketing

Sometimes you get confused between PPC and CPC. PPC – Pay Per Click – This is an advertisement model where you have to pay for each click.  CPC – Cost Per Click – How much money you pay or are ready to pay for PPC is called CPC.
 

Immediate Result

This is the last and biggest benefit of what is PPC advertising or why it is important. In comparison to Organic Marketing Strategy, immediate results are seen from PPC Marketing (Or Inorganic Marketing). Whatever the goal of your ad campaign, you can create awareness in a short time and deliver products and services to interested customers.

Also Read: What is Pay-Per-Click Advertising with Examples

General pay-per-click statistics

  • $190.5 billion is the projected amount companies will spend on search advertising globally in 2024. 

  • For small to medium-sized businesses, the typical monthly cost of a PPC campaign is between $9000 and $10,000.

  • Businesses make $2 for every $1 invested in PPC. 

  • For more than a month, 72% of businesses haven't examined their advertising campaigns.

  • A PPC campaign is used by 65% of small to mid-sized enterprises.

  • 59% of consumers say they look up products online before making a purchase.

  • 47% of the total global purchases are completed online.

  • 39% is how much paid search accounted for in advertisers’ budgets.

  • 32% of companies use PPC to sell products directly to consumers.

  • By 2024, it is anticipated that global search advertising spending would reach $190.5 billion.

  • In the Search Advertising market, ad spending is expected to reach $118.2 billion by 2024.

  • $8.67 is the highest average CPC for Google Ads, belonging to the legal industry.

  • The lowest average CPC for a search on Google Ads is $1.40, and it comes from the real estate industry.

  • 96% of advertisers spend money on search ads. 

  • 92% of the global search engine market is controlled by Google. 

  • 80% is about how much search ads can increase brand awareness. 

  • 65% of all high-intent searches result in an ad click.

What is PPC marketing ?

PPC stands for pay-per-click marketing. It is a marketing strategy designed to drive traffic from search engines or other websites to a company’s website. The advertiser is paid when someone clicks on the ad. Hence, the payment is made per click.

Why is PPC an essential part of online advertising?

PPC is important because it shows results much faster than organic campaigns that integrate search engine optimization techniques (also referred to as “natural search”). PPC helps companies reach the right customers and is also useful in marketing products that otherwise may be difficult to find. 

What is the actual cost per click?

The actual cost per click (CPC) for advertisers is determined at auction and is not visible, but maybe less than your maximum CPC bid. This is because you only pay what’s required to beat the ad rank of the nearest competitor below you. The equation for determining CPC looks something like this: CPC = (Ad rank to beat / Quality score) + $0.01. However, the average CPC can be seen.

Is PPC only appropriate for big brands?

No, businesses of any size can utilize the benefits of PPC. The most important aspect of a PPC campaign is to find the right keywords that are relevant and targeted.

What is the limit of characters used in a PPC Ad?

A standard ad can have a maximum of 25 characters in the headline and 70 characters total in the descriptions. An expanded text ad can have 30 characters, each in the first and second headlines. The description of an expanded text ad can have 80 characters.

Why do you think PPC is important in digital marketing?

PPC, or "Pay-per-click,” is a form of digital advertising where advertisers pay a fee each time a user clicks on one of their ads. In other words, it's a way of buying visits to a website rather than trying to "earn" them organically through search engine optimization (SEO) or other marketing methods.

Here’s why PPC (Pay-per-click) advertising is an essential component of digital marketing:

  • Targeted Advertising
  • Cost-effectiveness
  • Measurable Results
  • Quick Results
  • Flexibility

What are the Factors which affect Quality Score?

  • Quality Score depends on the following metrics
  • CTR of the Keyword
  • The relevance of Keywords and Ads
  • Landing Page Quality
  • Historic Account Data

Can you tell me a limit of the character used for PPC Ads?

  • Expanded Text Ads its 30 Characters – Headline 1 and 30 Characters for Headline 2 and 80 Characters in Description.
  • Standard Ads has the limitation of maximum 25 for the headline and 70 for description 1 and 2 combined.

Why did you choose a career in Adwords/PPC?

I am a marketing aspirant, and in this digital age, AdWords proficiency can help me reach my goal of being an expert in the PPC domain. The demand for the profession is high, and I enjoy working with budgets and ad copies.

Why did you choose a career in PPC?

I would find it motivating to help the business grow with my marketing strategy and tactics. Adwords provide a challenging, yet exciting opportunity to help advertisers make a meaningful impact.

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