Pay Per Click is a method of online advertising that has become increasingly popular over the last decade. The two main advantages of a pay per click program, also known as PPC, are that ads are targeted to specific keywords and second, that if no one clicks on the link there will be no charge for the advertisement.
Perhaps the most well-known sellers of pay per click advertising are search engines. However, pay per click ads can now be found on almost any kind of website, from internet-based email applications to blogs and news sites.
For example, a company that specializes in consumer debt negotiation may have their advertisements appear as a sponsored link whenever someone types ‘get me out of debt’ or ‘debt help’ into Google. If the person who initiated the search proceeds to click on the link, then the debt negotiation company will pay a fee to Google. It’s important to note that payment is in exchange for a click and does not depend on whether or not the user actually ends up using the company’s services.
Websites other than search engines that offer pay per click advertising do so based on the content present in a given page instead of content entered by the user. For example, the debt negotiation ads might appear on an article that uses the phrase ‘debt help.’
The per-click fee is usually set in one of two ways. First is the flat-rate PPC ad method in which the website will set a fixed price for each click. Each time a user clicks on an advertiser’s link, the advertiser will pay the website this flat rate. A website may have varying rates based on the placement of the ad on the page much like newspapers and periodicals. Of course, a more prominent position will cost more per click.
The second method of determining PPC fees is bid-based. Advertisers set a maximum price that they are willing to pay per click, and the ads of the highest bidders at any given time are placed on the website.
For example, three used book stores may be bidding on the right to display ads when the key phrase ‘cheap books’ is entered. The first may agree to pay as much as $2.00 per click, the second $1.75, and the third $2.25. The third advertiser is the winner in this scenario and they would typically be charged $0.01 above the next highest bid: $2.01.
If the first advertiser pulls out of the bidding later, the third would then pay only $1.75 per click: the amount of the next highest bidder plus $0.01. As you can see, the pay per click program is very similar to auction websites such as eBay.
Get more tips on how to minimize costs and maximize traffic to your online business now at www.PaidSabbatical.com/blog.html.
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