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An introduction to pay per click advertising

February 18, 2008

Pay per click advertising is the process of placing a relevant advert on a search results page and paying for each click on the advert that will lead though to a destination page on your website.

Immediate results

Create an advertising campaign and go straight to the top of the results pages for your chosen keywords. Control your spend and calculate your return on investment. Monitor carefully or it could be costly. Pay per click advertising is all about researching, targeting, decision making, budgetary control and rapid results.

In its simplest form

Prepare your landing page(s).
Design your advert(s).
Choose the keywords to bid on.
Specify your budget.
Set you maximum bid amount.
Someone clicks on your advert and goes to your website.
You pay up to your maximum bid amount for the click.
Monitor, test and refine to optimise your advert(s).
Calculate ROI.

The players

There are two main players, Google AdWords and Yahoo Sponsored Search, plus a fairly recent arrival, Microsoft adCenter. Google’s adverts are called Sponsored Links. Yahoo’s adverts are called Sponsor Results. Microsoft’s adverts are called Sponsored Sites.

Cost per click

Cost per click is the amount you pay every time someone clicks on your advert. This is usually £0.01 more than the nearest competitive bid and no more than your maximum bid amount.

Clickthrough rate

Clickthrough rate is the ratio of clicks on your advert to impressions of your advert. An impression is whenever you advert is displayed as a result of somebody searching on your keyword.

Position on results page

The highest bid does not necessarily secure the highest ranking. The quality of the advert is a key factor. This is determined by expected performance and historical performance. Google and Yahoo each have their own algorithims for measuring ad quality. Clickthrough rate, advert relevance to landing page and keyword performance are all major factors.

Be prepared

A pay per click advertising campaign will only bring in new business if your website is capable of converting clicks into sales. Before embarking on such a campaign, it’s vital to make every effort to ensure that your landing pages are sufficiently engaging and compelling. The pages will need to connect with the visitors. And you must consider the site’s usability, accessibility and readability.

Filed in: Pay Per Click