Pay-per-click (PPC) is an advertising type where an advertisers pays to a platform like Google or Bing to feature an ad on its platform and is being charged only when a customers clicks the ad. The amount paid for a click depends on the auction held for a particular ad placement at a current time. The cost-per-click is high at prime time and highly demanded industries. The CPC is high at industries like real estate, legal services, while it is relatively cheap at industries with a low online presence. Pay-Per-Acqisitiom is similar to PPC advertising, where the advertisers pays a specific amount to the platform, for every acquisition, the price of which the advertisers gets to choose. The advertisers who pays more gets higher number of acquisitions/clicks and vice-versa.
Advantages of Using PPC
1. Pay for Performance: You only pay for the visits you receive, ensuring a direct link between cost and performance.
2. Detailed Analytics: PPC platforms provide complete knowledge about ad performance, including impressions, clicks, and conversions.
3. Optimization Opportunities: With real-time data, you can create several variations of each ad and compare them to see which ones work best, allowing for immediate corrections and better results.
4. Targeted Reach: Thanks to segmentation options, your ads reach the right audience, increasing the chances of clicks and reducing costs.
5. Budget Control: PPC allows precise budget management, with options to set maximum daily budgets, making it adaptable for advertisers of all sizes.
Examples of PPC Usage
1. Search Engines: Search engine marketing allows you to show ads based on keywords entered by users, such as “car sharing in London.” Major search engines like Google and Bing use PPC models based on auctions, making ads highly visible and effective.
2. Social Networks: Platforms like Facebook and Instagram offer PPC options where ads are integrated into users’ social experiences, leveraging social network data for highly segmented campaigns.
3. Display Ads: PPC is used in displaying banners of a brand. They are used extensively in remarketing a product to visitors of a brand like its website or any of its social media handles. The conversion rates are however low due to low purchase intent in customers who are randomly browsing in areas where display ads are shown. The low conversion rate in this segment is compensated by lowers CPCs.
