What is Pay-Per-Click?
The internet is full of free content. How does it get paid for? The simple answer is advertising. You get access to a practically endless library, with more information on any topic than you can get through in a lifetime, and the only price of admission is to see or watch ads.
Pay-per-click is one of the models of internet advertising which is designed to direct traffic to particular websites. An online publisher (a site which provides content) puts up ads for the services or products of a company on their website. Whenever a visitor to that site clicks through the ad to the advertiser’s site, the publisher gets paid by the advertiser.
Often first-tier search engines like Google and Bing will use PPC, by including relevant ads in search engine results. So if someone is searching for information about shoes, the search engine may include ads for the products of shoe companies.
Non-search engine websites can also host ads on their websites, in order to get revenue. They will connect ads to their relevant content, in order to target visitors who are interested in particular topics. If your company mainly provides online content to a wide audience, you might want to consider using PPC to boost revenue and pay for the content you provide. But if your company mainly sells offline goods and services, or has a target audience willing to pay for content, then you can use PPC to get the message out about your business.
For any company looking to do this, Google Adwords is a good place to start. Google is the most popular search engine around, and is a secure choice for advertisers. Some unscrupulous publishers engage in “click fraud”, by having robots or employees click on adverts continuously to artificially increase traffic and cheat advertisers out of their money. It’s clearly a black-hat practice, but Google have set up automated systems to detect and prevent click fraud involving Google Adwords.
How to Use Google Adwords
First, you need to know the costs and margins of your products, as well as how much you want to spend on ads and how much you want to get back. Companies spend money on Google Adwords in order to get their ad to the top of a search results page when people search for pertinent keywords. You can use the Google Keyword Planner to decide which keywords will be best for you. The Adwords market is an auction, with companies bidding for search rankings. You can bid up to $2 per click. However, the highest bid doesn’t always win. Google determines the winner based on the quality of ads, as well as the money spent. Good quality ads, ones which create worthwhile and lasting user experiences, can be a more important factor than money.
Despite thousands of companies taking part in Google Adwords, many can achieve high ROI and get their money back many times over. But this can take time and experience to do. You will need to pick which keywords your ads will show up for. Google will charge you for every click your ad gets, and tell you the number of impressions your ad gets (how often people see the ad). With this information you can determine the click-through-rate, how often users that see your ad click it. You can use this to tell how successful your ads are at motivating people to click them. You also need to make sure that those clicks turn into conversions (i.e. they buy something). Otherwise what’s the point of spending money on advertising? On Google Adwords you can target your campaign to particular regions, depending on where your potential customers are.
As well as setting a maximum bid, you can set up a daily budget, which determines how much Google can charge you that day. So if you have a budget of $50, and pay $1 a click, once your ad has been clicked 50 times Google will pull the ad and no longer charge you. To determine your budget, you need to calculate profit per sale and conversion rate. How much money do you make from a sale (minus costs) and how often do people who clicked on your ad buy the product? If the profit per sale is $20, and 1 in 10 people who clicked through buy, then the budget is $2 per click. But Google gets a commission, the cost of publishing your ad. If you give Google a 50% commission, then that’s a maximum budget of $1 per click. If you want to get 10 clicks a day, then the budget is $10 a day. You don’t have to start with hundreds of clicks a day, a few a day will help to grow your business’ influence.
Make sure that your landing page is the best it can be. You’re paying money to direct people to that page, and they will make a decision to buy or not buy on the basis of what they see. To make your landing page enticing, keep it simple, paring down the information on the page to the bare minimum required. This will focus the visitor towards what they want to know and the call to action, as well as shaving off loading time. You also want a powerful headline which will stand out and make visitors take notice; it’s the first thing they will read and needs to hook them in. It will need to have a clear message about how your company is different from competitors. Use simple language, without any jargon or words that won’t be widely understood, and include bullet points and photos to make the page eye-catching. Ensure that signing up, or paying, is simple and doesn’t require too much form-filling or clicking through.
When writing the ad itself, you only have a few words so be concise and to the point. There are three parts to a Google ad: the headline, the URL and the copy. Ideally the headline and URL should display the keyword or one of them. You can cut off the http(s):// from the beginning of the URL to leave more room for the copy. The ad copy is 2 lines of text and should include a unique value position (UVP), distinguishing yourself from competitors, and a call to action. For example, if you’re selling shoes the copy might be “Customizable shoe patterns. Buy online now.” This ad shows how you have a unique offer, and what the customer can do to take part.
Then all you need to do is track conversions, and make adjustments to your campaign if necessary. Then watch the conversions roll in. The more people buy your products, the more money you can spend on ads, creating a virtuous cycle and helping to grow your business.