What Is Pay-Per-Click (PPC) Marketing? A How-To Guide

Any marketing professional will tell you that PPC advertising is worth investing in.

Paid search marketing offers several key benefits that make it a powerful tool for businesses looking to boost their online presence and drive results. Unlike organic search engine optimization (SEO), which takes time to build up and rank your website higher in search results, PPC ads can be launched and appear at the top of the search engine results page (SERP) almost instantly. It’s one of the fastest ways to spin up a campaign and drive clicks, conversions, and leads.

PPC campaigns can be run on various platforms across the internet, ensuring that your brand and products are visible to potential customers when they are actively searching for related products or services. This increased visibility not only drives more website traffic but also enhances brand recognition and awareness.

Learn more about what PPC marketing is, how pay-per-click works, the costs, creating an ad, examples, and more.

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What Is PPC Marketing?

PPC, or pay-per-click, is a type of internet advertising model where you pay a fee each time your ad is clicked. PPC marketing campaigns were made famous by Google, most notably on the Google search engine. Google Ads allows businesses and advertisers to promote their products, services, or content on its search engine as well as its vast Google Display Network of partner websites, apps, and platforms, including YouTube and Gmail. Formerly Google AdWords, Google Ads offers a range of ad formats tailored to meet different marketing objectives. Advertisers can tailor budgets, demographics, and locations for precise targeting.

However, you can run a PPC campaign in all the places it matters online. On top of YouTube, you can also run ads on other social media platforms like Facebook, Instagram, Twitter, and Tiktok. Bing Ads and Microsoft Advertising are a few alternatives to Google Ads for online advertising. Bing Ads, now integrated into Microsoft Advertising as “Microsoft Ads”, enables businesses to run PPC campaigns on Bing’s search engine and its partner platforms, including Yahoo. It also extends to Microsoft’s Audience Network, displaying ads on Microsoft-owned sites and partner websites.

How Does Pay-Per-Click Work?

Pay-per-click advertising is simple: you only pay when a person clicks on your ad. In this model, advertisers bid on specific keywords relevant to their products, services, or content. That means if your ad appears in Google, you will only pay if someone actually clicks through to your website.

The process of PPC advertising involves the following key elements:

Ad Auction: When a user enters a search query or visits a website that triggers an ad, an ad auction takes place. In the auction, advertisers’ bids for the specific keywords are considered, along with the quality and relevance of their ads and landing pages. The ad with the highest combination of bid and ad quality is selected to be displayed.
Ad Placement: If the ad wins the auction, it is displayed in a prominent position on the SERP (for search ads) or on relevant websites (for display ads). The ad is often labeled as “Ad” or “Sponsored” to distinguish it from organic search results.
Cost Per Click (CPC): In this PPC model, advertisers only pay when a user clicks on their ad, not when the ad is displayed (impressions). The amount paid for each click is the cost per click (CPC), which varies based on factors like keyword competitiveness, ad quality, and the ad’s relevance to the user’s search query.
Advertiser Control: Advertisers have control over their PPC campaigns, including the budget, bidding strategy, ad content, and targeting options. They can set daily or monthly budgets to manage their ad spending effectively.

Negative Keywords: These are terms or phrases that advertisers specify to prevent their ads from showing up in search results or on websites when those terms are present. This can help avoid displaying ads to irrelevant or uninterested audiences, ultimately reducing wasted ad spend and improving the overall campaign performance.

How Much Does Pay-Per-Click Cost?

Estimates vary, but HubSpot estimates the average CPC is $1 to $7. The cost of PPC advertising depends on several factors, including the ad network, your audience, and the competitiveness of your industry or keyword. For example, because Bing has a smaller audience, a PPC ad on Bing costs $7.99, while Google costs $20.08.

To ensure a successful and cost-effective PPC campaign, advertisers should define clear goals, conduct keyword research, and assess industry competitiveness. By setting a budget aligned with campaign objectives and strategically bidding on relevant keywords, advertisers can maximize the impact of their ad spend. Regularly monitoring performance metrics and making data-driven optimizations allow for better budget allocation, and testing ad creatives, landing pages, and targeting options helps identify the most effective combinations. Advertisers can achieve optimal results in the competitive ad auction landscape by continuously adapting their budget allocation based on performance insights.

Does Pay-Per-Click Really Work?

Search Engine Marketing (SEM) combines both SEO and PPC advertising, creating a powerful synergy to achieve marketing goals. The PPC advertising model of SEM provides advertisers with a measurable and cost-effective way to reach a highly targeted audience actively searching for products or services. Businesses can leverage keyword research, ad copy optimization, and bid strategies to ensure their ads are shown to the most relevant audience. One of Your Marketing People’s clients saw a 105% higher conversion rate by increasing their ad budget by only 30%.

The PPC model offers several advantages to advertisers:

Cost-Effective: Advertisers only pay when their ads generate user engagement (clicks), ensuring that they are getting value for their advertising spend.
Target Reach: PPC allows precise targeting based on keywords, demographics, interests, and geographical locations, ensuring that ads are shown to a relevant and interested audience.
Measurable Results: Advertisers can track the performance of their ads in real time using analytics tools, enabling them to measure ROI and make data-driven optimizations.

By combining SEO efforts with PPC advertising, businesses can maximize their online presence and increase their chances of capturing potential customers at different stages of the buying journey. Another brand working with Your Marketing People achieved 4+ Return on Ad Spend with a multi-channel approach to paid search.

Through continuous optimization and data-driven strategies, businesses can enhance their online visibility, drive relevant traffic, and achieve success in the competitive landscape of search engine advertising.

The Difference Between Google Ads vs Microsoft Ads

When comparing the audience reach and cost considerations between Google and Bing, there are some notable differences that advertisers should take into account.

Audience Reach

Google is the most dominant search engine globally, holding a formidable share of the search engine market. It processes billions of search queries daily, making it the go-to platform for users seeking any information, products, or services. As a result, Google Ads provides access to a large, diverse audience across various demographics and interests.

While Bing’s search engine market share is smaller than Google’s, it still commands a significant portion of the search market. Bing is the default search engine for Microsoft’s devices and it also powers Yahoo’s search results. As a result, Microsoft Ads can reach a substantial audience, including users who prefer Bing or those using devices where it is the default search engine.

Cost Considerations

Due to its vast reach and high demand from advertisers, Google Ads can be more competitive and costly. Popular keywords in competitive industries may have higher CPCs. Advertisers with limited budgets might find it challenging to compete effectively for top positions in Google’s search results.

Microsoft Ads typically offers a more cost-effective option for advertisers compared to Google Ads. The competition on Bing is lower, leading to potentially lower CPCs. Advertisers with smaller budgets or in niche industries may find that Microsoft Ads provides them with better visibility and return on investment.

Cost considerations also may vary based on your target audience, industry, and campaign objectives. Advertisers looking to diversify their PPC efforts or explore untapped markets may find Microsoft Ads an attractive alternative due to its potentially lower costs and unique user base.

How Do I Create a Pay-Per-Click Ad?

The specific steps of creating a PPC ad will depend on the platform you’re advertising through. Regardless, creating a successful PPC campaign involves careful planning and execution:

Define Campaign Goals: Clearly outline your campaign objectives like increasing sales, generating leads, or promoting brand awareness. Align your goals with specific metrics for measuring success.
Conduct Keyword Research: Identify relevant and high-performing keywords related to your products or services. Use tools like Google Keyword Planner to discover relevant keywords and estimate search volumes.
Select a Campaign Type: On Google, you can select from search PPC ads, which appear on the Google Search Engine results pages. You can also use display ads, which are typically images and are particularly effective for remarketing campaigns. Finally, there are Google Shopping ads, which have special results that highlight individual products. On social media, PPC ads can show up in the main feed, in stories, and more.
Organize Ad Groups: Group keywords into ad groups based on their relevance to specific products or themes. This structure improves ad relevance, click-through rates, and Quality Scores.
Creating Compelling Ad Copy: Craft persuasive ad copy that includes the targeted keywords and speaks directly to your audience’s needs and pain points. Emphasize unique selling points and calls-to-action (CTAs).
Develop Landing Pages: Create optimized landing pages that align with the ad’s messaging and provide a seamless user experience. The landing page should be relevant to the ad’s keywords and deliver on the promise made in the ad copy.
Set Budget and Bid Strategy: Determine your budget allocation and bidding strategy. Bid competitively on relevant keywords to improve ad visibility without overspending.
Implement Conversion Tracking: Set up conversion tracking in your PPC platform and link it with Google Analytics. This enables you to measure and analyze campaign performance based on specific actions, such as form submissions or purchases.
Launch and Monitor: Launch your PPC campaign and closely monitor its performance. Analyze key metrics like click-through rates, conversion rates, and return on ad spend (ROAS) regularly.
Optimize and Refine: Continuously optimize your PPC campaign based on performance insights. Adjust bids, ad copy, and landing pages to improve ad relevance and conversion rates.
Test and Experiment: Conduct A/B testing to compare different ad variations, headlines, and CTAs. Test different landing page layouts and content to identify the most effective combinations.
Review and Adjust: Regularly review your PPC campaign’s progress and make data-driven adjustments. Refine your keyword list, ad groups, and targeting to enhance overall performance.

For more advice on setting up a PPC ad, read our guides:

What are Some Pay-Per-Click Advertising Examples?

Once you know where to look, you’ll start to see PPC ads everywhere. These examples showcase the versatility of Google PPC advertising, allowing advertisers to choose the most appropriate ad formats for their marketing objectives and target audiences. Here are a few of the popular Google advertising formats.

Text PPC Ads

Traditional paid search text ads appear at the top or bottom of Google’s SERPs. You can expand these ads with promotion extensions to promote a deal or sale (pictured below), site links to drive traffic to specific website pages and call extensions to encourage phone calls.

Responsive PPC Ads

A responsive display ads is a dynamic paid ad that changes its size, format, and copy to fit the website they show up on. Advertisers enter possible variations for headlines, copy, and images. Then, Google creates the best combination depending on the website from its Google Display Network.

Shopping PPC Ads

Shopping ads is a paid ad format that enables e-commerce advertisers to showcase their products with key details like price, star rating, shipping, and of course, a product photo. These ads appear in the traditional search results as well as the Google Shopping tab.

Video Ads

These ads appear before, during, or after YouTube videos. They can be skippable or non-skippable and allow advertisers to showcase their brand or product through engaging video content.

Discovery Ads

These are ads that appear on Google Discover, YouTube Home, and Gmail Promotions, reaching users as they explore content on other platforms.

PPC Advertising and Your Brand

Overall, PPC advertising is a versatile and efficient online marketing strategy that can drive relevant traffic, boost brand awareness, and deliver measurable results for businesses of all sizes. Its ability to reach a targeted audience, control ad spend, and provide measurable insights makes it an invaluable tool for achieving marketing objectives and maximizing return on investment.

From text to video, and shopping to search, the world of PPC ads continues to grow. To stay on top, you’ll want professional paid search managers and social PPC experts on your side. PPC experts possess in-depth knowledge of various platforms, ad formats, and optimization techniques.

Contact Your Marketing People today to discuss your PPC goals. Our paid search experts understand the complexities of the PPC landscape and can navigate challenges efficiently. We ensure that ad spend is used effectively and marketing goals are met with precision.