What Is Pay Per Click?

Do you wonder how internet giants such as Google earns money? Well, aside from being the most dominant search engine today, they also engage in dozens of online advertising businesses. One of these lucrative internet marketing endeavors is Pay Per Click or  PPC .  PPC  is very similar to affiliate programs where an affiliate is paid by an advertiser for every click. The  PPC  system heavily depends on the use of relevant keywords that are geared towards the target market with the aim of directing traffic from the affiliate to the advertiser’s website.

As the internet continues to boom, the number of hours a person is logged online also increases. Thus the opportunities for growth in the  PPC  model are immense. Today, Google AdWords and Bing Ads from Microsoft and Yahoo are the most prominent and successful Pay Per Click Advertising modes.

How does  PPC  Work?

As mentioned, advertisers pay whenever a user clicks on the ad displayed on an affiliate website or on the search engine results page. In an affiliate website,  PPC  ads will be displayed when a keyword query matches the advertiser’s keyword list or whenever a site has relevant content. They usually appear beside, above or beneath the organic results on a SERP (search engine results page) or anywhere an affiliate web developer chooses to place it on a content site. Google uses its own search engine results page to display these sponsored links and generate traffic to advertisers that match the keyword. Google’s closest competitor, Bing, also uses the same method, displaying sponsored ads alongside the organic results for maximum visibility.

Cost of Pay Per Click

In the  PPC  model, there are two ways to determine how much an affiliate gets paid for every click-either flat rate or bid based. With a flat rate  PPC  system, the advertiser and the publisher both agree on a fixed price per click. This particular model is more commonly used in comparison shopping engines that often publish rate cards.

However, flat rate PPCs are often minimal in cost. In many cases, advertisers have the option to pay more for greater visibility and consequently, higher traffic. These comparison shopping sites typically have an organized layout according to product or service categories, thus allowing the advertiser to fine tune their  PPC  campaigns. Most of these sites have paid ads as their core content.

Meanwhile, established  PPC  tools such as Google AdWords use a highly automated bid management system. These tools allow advertisers to bid for their ads and manage their bids easily. The system generally sets a bid based on the goal that an advertiser has set, which includes maximizing profit, traffic, and so on.

For affiliates to determine the profit that they can generate through  PPC , they have to take a look at the traffic that their site can generate. A website must be a trusted source of content to be an effective advertising platform. It has to be able to entice customers to click on the sponsored ads. Success in the  PPC  system won’t come overnight but with perseverance,  PPC  affiliates are able to generate a significant profit from it in no time.

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