Pay Per Click 101

PPC marketing is one of the easiest methods of building brand awareness and jump-starting the launch of a brand new website or product.  PPC,  (Pay Per Click) marketing offers incredible exposure for both start-ups and seasoned entrepreneurs, alike.

There is a downfall when it comes to promoting your website through PPC marketplaces and that is the risks involved with creating campaigns that end up costing you a fortune while producing very weak results.  This is why so many PPC “newcomers” bail out after spending money on campaigns without having a solid plan of action in place.

If you truly want to be successful with PPC marketing, you need to know exactly how to create highly targeted campaigns that will speak directly to your target audience, while increasing your CTR (click through rate) and lowering your CPC (cost per click).

When it comes to the cost of marketing via the PPC marketplaces, primarily Google Adwords, the assigned costs is dependent on your overall quality score.  

Google implemented this scoring system as a way of rewarding marketers who take the time in carefully planning out their PPC campaigns so that their advertisements receive a high number of click throughs from their target audience.
This means that the more focused you are in creating highly targeted PPC campaigns, the lower your overall costs will be.  

So, how can you get started and what do you need to know in order to create relevant advertisements that drive in traffic and weed out worthless click through’s that will only end up costing you money?

Here’s a quick overview of what PPC marketing is really about:

For starters, choosing the right keywords for your PPC marketing campaigns is critical. Keywords are what your potential prospects enter into the search engines in order to locate information and content similar to what you are offering.

This means that you absolutely need to drill down into your niche market to determine exactly what your customer base is entering into the search engines.  Conducting keyword research prior to creating your PPC campaigns is essential if you want to boost your quality score and maximize your click through rate.

You would use these keywords in every campaign you create, both within the actual creation of your PPC advertisement as well as within individual campaigns.  Whenever you assign a keyword phrase to a PPC campaign, it appears within Google’s search results whenever a potential prospect has entered in the same keyword phrase.

As a quick example, by visiting http://www.Google.com and entering in “Twitter Marketing”, you will see from my example below that the advertisers that appear within the Sponsored Ad Listings are all targeting that specific keyword phrase and offering information and resources focusing on marketing products and services using the Twitter network:

Here are a few terms that you should become familiar with before getting started with your first PPC campaign:

Display URL

 

This displays the website address that, when clicked, directs people to that specific site.

 

While this address can appear to be different than the actual destination URL, I suggest using the true URL that your visitors will be directed to.

 

Destination URL
This is the actual URL that your visitors are sent to when clicking on your link.

 

 

In addition to the four main parts of your advertisement, there are a few terms that you should familiarize yourself with including:

CPC: Cost Per Click and/or CPA: Cost Per Action 

 

Adwords charges its advertisers for every click that their advertisement receives.  You are not charged for exposure regardless of how many times your ad is displayed in search results.

 

Cost Per Click:

 

This is the amount you’ll actually pay for a click on your ad.

 

The AdWords Discounter automatically gives you the lowest possible price in order for you to maintain your ad’s position. Your actual CPC will be equal to or less than the CPC bid you specify for your ad group, keyword or placement.

Cost Per Action:
Your cost-per-action, or CPA, is the current amount that you are willing to pay for a specific action to be completed on your site. This cost generally varies depending on product and on type of action. You set your own fixed CPA for each action when you create a pay-per-action campaign.

Landing Page

 

A webpage where customers will ‘land’ when they click your ad. The web address for this page is often called a ‘destination URL’ or ‘clickthrough URL.’

CTR: Clickthrough Rate

Clickthrough rate (CTR) is the number of clicks your ad receives divided by the number of times your ad is shown (impressions) via Google search only. Your ad and keyword each have their own CTRs, unique to your own campaign performance.

A keyword’s CTR is a strong indicator of its relevance to the user and the overall success of the keyword.

Maximum Bid

Your maximum bid is the higher amount you are willing to pay per click.

Minimum Bid

This is the amount that you assign to each keyword that you target within your campaigns.  The minimum bid essentially, represents the lowest price you will pay per click.

Quality Score

Google Adwords attaches a quality score to advertiser accounts, which is determined by your CTR (Click Through Rate: see above). Other factors that directly impact your Quality score is how relevant your advertisement is, past performance, etc. 

Depending on your quality score, your minimum bid requirement may be lower than another user with a lower quality score. This means that you should do your best to increase your quality score and maintain it.

 

Campaign

Campaigns are used to give structure to the products or services you want to advertise. The ads in a given campaign share the same daily budget, language and location targeting, end dates, and syndication options.

Within each campaign, you can create one or more ad groups. While a campaign may represent a broad product class, the ad groups within that campaign can be more focused on the specific product you want to advertise.

Conversion Rate

Our conversion rate is the number of conversions divided by the number of ad clicks. Conversions are only counted on Google and some of our Google Network partners.

Creating Your Account 

If you have yet to create an account, head on over to http://www.adwords.google.com/select to get started.
Click here for information on how to quickly set up your PPC account.