The biggest companies in Pay Per Click (PPC) are Google AdWords, Yahoo Search Marketing and Bing Ads. PPC for search engines is effectively an auction where a number of advertisers bid for certain search key words or phrases, but the advertiser only pays when their ad is clicked.
All these companies:
- Compare the amount which each advertiser will bid
- Assess the relevancy of the key word phrase to make sure they match what the user wants. This is important because this is the primary reason the user is using the search engine in the first place and the advertiser in turn really only wants to pay for appropriate traffic.
- Review the landing page to ensure that the content is relevant to the key words. The search term must match the landing page otherwise it is pointless.
The Search Engine company’s goal is that the user and advertisers all to have a good experience so they continue to use the provider’s system.
When a user makes a search the search engine evaluates the bid, relevance and quality in real time to calculate a ranking and presents the results links in ranking order. When a user clicks on one of the links they get passed through to an advertiser landing page with relevant content. These landing page are special pages which typically have specific information about the product and pricing information and anything else required by the user to make a decision about the product or service.
PPC advertisers typically set a budget and decide which key words they wish to pay for. It should be noted that taking popular key words may not always be the most cost effective way of driving traffic. From a value for money stand point it is often also sensible to take a slightly lower ranking and avoid a bidding war for the top position.
In most cases a cap can be set on how much advertising and advertiser wishes to pay for. Careful ‘keyword research’ is also advisable in order to increase Ad quality and to gain better unpaid organic positioning as well.
Most pay per click providers have developed methods for preventing abusive use of pay per clicks by competitors, so you are protected and should receive genuine traffic in most cases.
Google Ad Words Example
Google advertising appears in two places, at the top and on the right hand side of the browser window. The highest ranked match is on the top left hand side. These are referred to as sponsored links.
Google Search Results
As previously discussed the ranking of a sponsored link is evaluated using a combination of the bid and the quality score.
The quality score is evaluated based on a three factors:
- Click through rate - this is an empirical and real world evaluation on whether the link is appropriate.
- Relevancy – calculated by analysing language and context of content relative to the keyword to ensure that only relevant content is presented.
- Landing page quality – the content should help the user with what they are looking for, with relevant and original content i.e. a page specific to the keyword or phrase and not just a home page. The page must also load quickly, be easily navigable and transparent about the product or service being offered.
It is important to note the advertiser paying the highest fee does not necessarily get the highest ranking, as this is also highly dependent on the quality score. If the quality score is very low the sponsored link may not be shown at all.
Example - Amazon Landing Page