Pay Per Click

Pay per click (PPC) advertising allows you to pay to have your ad listed on the major search engines. They are the sponsored links you might see when you perform a search in a search engine. They usually appear at the top, bottom or right side of the search engine results page (SERP) and are identified as Paid Listings, Sponsored Links, Sponsored Listings, or Featured Listings. Pay per click (PPC) search engines call for you to pay to have your advertisement listed on the major search engines by allowing you to bid on keywords that are related to your business.
The rank or relative positioning of PPC campaign ads are based on an open bidding system. In this system, advertisers bid to have their advertisement listed. The bid amount is paid by the advertiser when a visitor clicks on the ad; hence, this is also known as a "cost per click" program. These terms are sometimes used interchangeably to describe Pay Per Click web advertising even though PPC refers to a payment method and CPC refers to the cost involved in each payment. Theoretically, whoever bids highest gets the highest listed position, although some search engines, such as Google, have made it a little harder by using a formula that bases position on more factors than just your bid. And as more of your competition enters into this developing market, the competition will only become more fierce. Optimizing your PPC campaign will keep you one step ahead of the pack.

As mentioned in the PPC Methodology section, your PPC ranking is based upon your bid relative to other bids that are made in an auction-like bidding system. Therefore, if your advertisement has the highest corresponding bid, your ad will appear at the top of the Paid Listings results page. If your bid is the second highest, then your ad will appear second, and so on.

For the major PPC engines, the top one to four bid positions are the ones that receive the highest amount of distribution across their search partner networks, and hence receive the greatest exposure and click traffic. Our advice for bid management is to initially position your bids so that your ads will appear third, with the best targeted title and text possible. The fee is a little lower (usually) and the click thru rate remains quite high.
When search engine visitors click on your PPC ad, they are sent to a page on your web site. As an advertiser, you are only charged when a visitor clicks on your advertisement to visit your web site. Typically minimum bids start at $0.05 and up to $50.00, although few bids ever reach that higher level. For most advertisers bidding averages between $0.25 and $2 per click (visitor).

The majority of advertisers who employ both SEO and PPC typically report very positive results, although a well-executed SEO plan over time can deliver more visitors at a lower overall cost than a PPC campaign.
Unlike banner ads that often display pictures and graphics, these advertisements are textual and appear in the search results like a search engine does.

Pay Per Click Internet Advertising offers you the ability to control how much you want to spend and where you want to be ranked. And, perhaps best of all, you only pay for actual traffic that clicks through to your web site!
It is estimated there are over 300 Pay Per Click Programs, but really the top 10 have about a 90% reach across the Internet.
Similar to Search Engine Optimization, designing, developing, and PPC campaign management takes time and labor, but the benefits are undeniable:

• Instant visibility & traffic: The more you bid, the higher you are listed and the more traffic you will receive.

• Quick to launch: Although some PPC campaigns require editorial review before they are active, some do not. Even with editorial review, a pay per click campaign can be active in a few days.

• Easy to Implement: PPC does not necessarily require expert knowledge to set up, although experience with search engines is definitely an advantage.

• Easy to track and measure conversions: With tracking code & metrics in place and data being gathered by the search engines, tracking a campaign's success is easier than it ever has been.

• No content or Web design changes necessary: Although you might want to make some changes to create a really effective campaign, none are necessary to get you started. Your existing Web site or Web page will work.

• Keyword conversion testing: You can use a PPC campaign to find out if you are targeting the right keywords by running a PPC campaign to see how well they will convert. Then incorporate the best keywords into your SEO (search engine optimization) campaign.

source: www.bruceclay.com