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Cost per click advertising

Cost per click (also known as Adwords or Pay Per Click) is a way of advertising on Google so that listings appear near the top of specific searches in the "Sponsored Listings" sections.


Pricing is done on a bidding system with more highly demanded categories costing more than the more obscure ones.


When initiating a PPC campaign you specify which search terms you want to target. You then bid a maximum amount you are prepared to pay for any given click. Essentially, if you are prepared to pay the most for your clicks you are generally given priority at the top of the sponsored list. Placement within the sponsored section is allocated largely on the basis of how much you bid although search engines also take into account links which prove popular in terms of previous click-through rates and also relevance of the search term you are trying to but against what they perceive the content of your site to be.


There are several aspects to PPC that make it attractive to advertisers. The first is that you only pay for the times that someone has clicked on a link and gone through to your site. So every penny you spend is actually driving traffic.


The second is that you can set budget limits so that you won't find yourself saddled with a bigger expense than you wanted. Once you reach your limit, the link is not put forward again until you add more to the pot.


A third element is that it can get you coming up on search engines more quickly if you have only just launched your site.


The fourth is, of course, that it can get you to the top of search engines where you might not be normally.


This kind of accountability has made PPC extremely popular with commercial websites. There are some negatives to watch out for. If you are prepared to pay for traffic you need to make sure it's the right traffic, which means being careful about the search terms you choose to pay for. Clicks need to be monitored to see if a particular link or creative is working better than another. Most importantly, if you are in a particularly competitive area the bids can be too high for some advertisers but this needs to be decided based on business models and analysis. It is almost always worth putting a limited budget forward to test the water.


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