2021-02-02 12:42:26 Marketing a Business English Learn about PPC, or pay per click, and how online paid advertising can work for your small business. https://quickbooks.intuit.com/ca/resources/ca_qrc/uploads/2021/02/what-is-ppc-photo-qbo-ca-desktop.jpeg https://quickbooks.intuit.com/ca/resources/marketing/what-is-pay-per-click/ What is Pay-Per-Click?

What is Pay-Per-Click?

12 min read

PPC, or Pay-Per-Click, is a form of digital media marketing whereby the advertiser pays a fee every time their ad is clicked by a user online. Many businesses have turned to this method of online paid advertising as it allows them to reach all kinds of audiences throughout the internet, driving traffic to their websites.

If you’re a business owner looking to use PPC advertising, then this article can help you learn what PPC is and how to use it to promote your company and convert click-throughs to sales.

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How Does PPC Work?

PPC is a paid marketing strategy that advertisers and businesses use to drive traffic to their websites. Essentially, when using PPC, you are paying for every click through to your site. Compared to organic marketing, where customers and users find and explore a business’s site naturally, pay-per-click is a paid marketing strategy. Therefore, companies must allocate their financial resources to a PPC budget when undertaking this advertising method.

PPC is not a physical form of advertisement as it is done online. It is not loyal to any specific company or search engine. PPC advertising is not tied to a platform like social media marketing is. However, it works much like physical advertising in that businesses can choose what form their paid advertisements take and where it will be displayed.

Think of PPC advertising as a billboard. A PPC manager won’t design the billboard, but they do decide where to place the billboard and when to show the billboard to audiences to gain the most significant effect. Maybe they choose to show the billboard along a busy highway during rush hour. The success of PPC hinges on the timing and placement of the ad, as well as its relevance to the people who see it.

Ad type

You can advertise on search engines, like Google or Bing with search ads. Or you can advertise through videos, banner ads, product carousels, on social media sites, and other forms of content one might find throughout the internet. Typically text ads and shopping ads will be used for search engine results, while display ads pop up on relevant websites within the site’s advertising placements.

Search engine advertising is the most popular form of PPC online marketing strategies, as it allows businesses to rank at the top of a search page. Hence, consumers see their site first when inquiring about relevant topics.

PPC Tire ad example

For example, when searching for winter tires, the search results that came back are divided into the product carousel at the top, and text ads below it. In both instances, take note of the small, bolded ‘Ad’ text that illustrates these products and sites are paid advertisements.

This search engine marketing and social media marketing is at the top of a sales funnel, which aims to attract potential customers to their products or services. You have to have an enticing opening to get potential customers to follow your product or service all the way down the funnel. The bottom of the sales funnel is when that potential customer turns into a customer, choosing to buy your product over others.

In recent years there has been a shift from organic marketing to paid advertising, with many professional marketers asserting that PPC is the industry’s future.

Why Do Businesses Use PPC?

Big brands and small businesses all use PPC as an online marketing strategy to promote their products and services. The most significant advantage of paid search advertising is its ability to place a business or brand at the top of a search engine results page. If you have the budget for it, PPC advertising offers businesses one of the fastest ways to reach the top of search results and achieve high visibility online.

Businesses are willing to pay for this type of advertising because when done right, the fee attached to the potential customer’s click-through is trivial compared to the revenue and sales it can generate for the company. If your business pays $3.00 per click, but the individual ends up buying your product for $250.00- that’s a large profit.

PPC is an essential tool in the marketing tool kit as it also allows companies to:

  • Target segmented audiences
  • Convert clicks to sales
  • Provide relevant data to users
  • Drive bottom-line objectives
  • Quantify their successes

One of the strongest features of PPC is its quantifiability. Businesses can measure their PPC ads based on the metrics and data collected to portray the campaign’s overall success or failure. A high click-through rate illustrates high quality and relevant ad content that entices the customer to venture onto your business’s website.

PPC is also a tool that can help you reach your bottom-line objectives. It can be used alongside other digital media marketing strategies to produce the greatest effect- whether that’s gaining new audiences or improving sales and revenue.

CPC vs. PPC

Where PPC is Pay-Per-Click, CPC is Cost-Per-Click. CPC is a concept you must factor for when advertising, as advertisers aim for a good, or low, cost per click. You don’t want your business to overpay per click if it’s not converting into sales.

When measuring this cost per click, advertisers will also look at CPM. CPM meaning cost-per-impression, which refers to the measured price a business will pay when their ad is shown per one thousand impressions.

CPC and CPM are key performance indicators of marketing. So is click-through rate and cost per acquisition. These relevant acronyms are all terms you will need to familiarize yourself with if your business will be undertaking PPC advertising.

What are PPC Campaigns?

For PPC advertising to work, you will need to create a campaign to reach audiences with relevant topics or themes. Businesses will create specific PPC campaigns surrounding their products or services to show up in relevant search results.

For your PPC campaign to be successful, it must possess each of these elements:

  1. Ad Groups: Each campaign is organized into ad groups that cover the promotion or product the PPC ad targets.
  2. Keywords: Specific words or phrases included in the ad that allows search engines to determine how relevant the content and ad is to a user’s search inquiry.
  3. Ad Text: The content or copy of the PPC ad, including all keywords. This text should be engaging to readers, enticing them to your business’s site.
  4. Landing Page: Each PPC ad links to a connected landing page that allows users to buy the product or service the ad is promoting.

Pay-per-click advertising example

For example, Imran runs a kitchen appliance store. Suppose he wants to run a PPC campaign surrounding his new, high-end appliances he just added to his inventory. Imran must first create his ad groups. A campaign can have one or multiple ad groups- these are the topics your pay per click campaign needs to hit. Imran decides to make two ad groups- one for high-end refrigerators and the other for high-end stoves and ovens.

Within each ad group are keywords. Keywords are specifically chosen words that are relevant to your ad content. Therefore, when Imran chooses his keywords, he will want to pick ones that apply to his refrigerator ad and a different set relevant to his stove and oven ad. State-of-the-art refrigerators, high-quality fridges, stainless steel refrigerators are all keywords Imran can use for his one ad group.

Once the keywords are chosen, an advertiser will need to create ad text. Ad text is the written content of your ad, including the relevant keywords. The ad text should contain a link that will take potential customers to your business’s specific landing page.

Every PPC campaign should have a landing page on its website connected to the paid ad through its keywords and text. Users can click through the ad to the landing page to complete the purchase. Imran will need to create specific landing pages that use the same keywords as his ads to bring users to his site.

What is a Quality Score?

A quality score refers to a numerical figure given to PPC campaigns to determine the overall quality of the content. Every platform or search engine has its version of a quality score that dictates how relevant your results are for a user’s search inquiry.

The largest ad platform in the world is Google Ads. Google’s quality score tells you whether or not your ads are of high quality by looking at:

  • How relevant your ad text and keywords are to the search terms
  • Overall landing page experience and how it behaviours for users
  • The ad’s click-through rate- and how the number of clicks on your ad compares to competitor ads

Essentially, a PPC campaign with fully search optimized ad groups, keywords, ad text, and landing page will result in a higher quality score.

What does a high quality score indicate, and why should you aim for this? If your business or brand possesses a high-quality score, it will ensure your ad ranks higher than your competitors and at a lower cost per click. This means if you have a high ranking quality score on Google, your paid ads will show up at the top of the search results for users resulting in higher visibility and a greater chance of a click-through to your site.

PPC Campaign Tips

When it comes to using online marketing strategies in pay-per-click advertising, there are specific techniques you can use to improve the success of your business’s PPC ads. Here are some of the things you should focus on to improve your ads’ conversion from potential sales to sales.

Focus on the keywords

The right keywords make all the difference when it comes to pay-per-click advertisements. The closer your keywords match the search inquiries of your target audiences, the higher the chances are of having your ad rank at the top of their search results. You’ll want to take time to research the types of keywords users are referencing in their search inquiries.

Advertisers use various online tools to help them decide which keywords are the best fit per campaign. Google’s keyword planner can help you determine which words and phrases will work best for your PPC campaign.

Use platforms where your target audiences are

You’ll need to do some customer research before implementing your PPC campaign. Understanding the needs of your target audience can help you tailor your ad campaigns to their search inquiries. Knowing what platforms they use will allow you to pinpoint the sites where your ads will show up.

If your target audience predominantly uses Facebook, you’ll want to ‘sponsor’ ad posts on that social media platform. Conversely, place your search ads within the search engines they use- are they on Google, Binge, or one of the other lesser-known search engines? Whatever platform your target audience uses, you should aim for your business’s ads to appear there.

Customize your content by campaign

For your PPC ads to convert from clicks to sales, you’ll need to customize all content attached to that campaign. Half the work of pay-per-click advertisement has to do with how well you optimize your ad groups, keywords, ad text, and landing pages within a campaign.

Each of these elements will need to possess content that matches the other, all of which must relate to the search intent of users.

Suppose a shoe business creates an ad referencing their new inventory of soccer cleats, but the link sends potential customers to the site’s page on basketball trainers. The user does not get what they want, and your sale falls through. Thus the ad has failed. Therefore, your ad has to work as a cohesive whole, enticing potential buyers in and moving them down the sales funnel until they reach the appropriate landing page and purchase the relevant promoted product.

Determine your marketing budget and stick to it

Like any part of a business’s operations- you need a budget that can cover these expenses. The amount of money companies pay for PPC ads varies from campaign to campaign and industry to industry. Some keywords are stronger than others, as more people are using them in their search inquiries. Therefore, a business that uses high-usage keywords in their ads will need to have a larger budget than a company that uses lesser-known keywords to pay for their usage.

The majority of PPC platforms use what is known as ad auctions to helps advertisers determine how much your ads and chosen keywords will cost you to use. When bidding on campaigns and keywords, consider the metrics previously mentioned. Look at the cost per click, cost per impression, and cost per acquisition attached to the relevant keywords to help you determine if the attached price tag is worth the conversion.

How To Set Up a PPC Campaign

Let’s break down the campaign process for pay-per-click advertising, Here’s what you need to do in order to create an online paid advertising campaign that will help your business reach its objectives.

  1. Determine what your PPC campaign goal is, whether you have one or multiple advertising campaigns and objectives.
  2. Split your campaign into ad groups. Each goal or objective should possess its own ad group.
  3. Research the most relevant and best-fitting Keywords per ad group to determine which keywords you will use per ad group.
  4. Set a budget for your paid advertising campaign based on the CPC of the keywords you have chosen.
  5. Research competitors to determine what keywords they are using, and what content or products you can offer that goes above and beyond the competition, making your ads more enticing than others in your industry.
  6. Create engaging, relevant high-quality content for the Ad text or copy, including the keywords and a link to your business site’s landing page.
  7. Create a landing page tailored to the keywords, and specific campaigns that offers a user-friendly interface and experience to entice potential customers to complete their purchase of your product and services.
  8. Starting converting those clicks to sales! Time to sit back and monitor your campaigns to determine if they are performing how you want and are moving you towards your campaign goals and objectives.

Your Business’s Online Marketing Budget

To successfully pull off a PPC campaign, you’ll need the right marketing budget to do so. Since this advertisement form is a paid marketing strategy, your business will require the funds to back your ads. This is where quality accounting software can help you and your business.

With QuickBooks Online, you can track and sort your expenses to ensure your marketing budget is going according to plan. Keep on top of your business’s advertising budget with a tool that keeps all your financial information in one place.

Try it free today and get your PPC campaign off to a good start.

<<Back: How to Create a Marketing Plan

Next: A Guide to Google Ads>>

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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