• What is PPC Advertising and How Does it Work?

One of the keys to a successful marketing plan is to have a diverse portfolio of methods to get your name in front of potential customers. With Americans spending on average 10 hours per day online, we would be remiss if we didn’t mention pay per click advertising. So what is PPC advertising and how does it work? Read on to learn about the types and costs associated with PPC advertising as it relates to search engines, web pages, and social media platforms.

How Does PPC Advertising Work

What is Pay Per Click Advertising?

Pay per click advertising, or PPC, is a popular form of online advertising that essentially buys visits to your website. Rather than paying for the ad up front, as you might with a billboard or print ad, you pay only when a user clicks on your ad.

PPC ads can show up on search engines, social media platforms, web pages, and apps, and they typically take a similar form as the content around them. For example:

Paid search ads look just like typical search results (web page title, URL, and description below). The difference is that they show up on the top and bottom of the first page of search engine results (like Google) when a designated keyword is searched.

• Twitter, Facebook, and Instagram ads appear in a users feed in the same format as organic posts, but are marked with “Sponsored” or “Promoted”.

Display ads fit into a designated spot on a web page, and may stand out with the business’s brand design, or take a “native” form for it to create a continuous view for the user.

PPC Advertising on Search Engines

PPC advertising on search engines is also known as paid search advertising or search engine marketing (SEM). Companies who are looking to advertise using PPC ads bid for ad placement. For instance, Google AdWords – the most popular PPC platform – allows companies to bid on keywords so that when that keyword is searched, their ad will show in front of that user.

PPC Bidding

As a small business, you may be wary of this due to competition from mega brands with deep pockets. The good news is, Google and other platforms have taken this factor into account which is why ad placement is not solely won on monetary bids alone. Two factors are considered when pulling in the winning advertisement:

•  Cost Per Click (CPC) Bid – amount the advertiser is willing to spend

•  Quality Score – the relevance of the advertisement

PPC Quality Score

This means that even if you have the lowest monetary bid on a keyword you can still win the ad space if your quality score is in good standing. This score is determined by four main components:

•  Click-through rate – how often your ad is clicked on vs. how often it’s viewed

•  Ad relevance – how good your ad is at communicating the significance of the keyword

•  Landing page relevance – how happy visitors are once they reach your landing page (determined by length of stay, bounce rate, etc)

•  Ad extensions – providing potential site visitors with more channels to connect with their goal (your address, phone number, link to download your app, link to a product review page, etc.)

PPC Advertising on Social Media

While Google AdWords in the most popular PPC modality, it is certainly not the only way to reach your target audience. Social media platforms like Facebook, Instagram and Twitter offer tremendous PPC advertising opportunities.

Facebook PPC

Facebook uses a method similar to Google when determining which ads their users will see.

•  Advertiser bid

•  Estimated action rates

•  Ad quality and relevance

Facebook is able to target their ads to possible interested parties with impressive accuracy by tracking a user’s previous actions. Do you ever notice that once you click on an ad you begin to see similar ads in your feed? That’s because Facebook took your historical activities and used them to help advertisers boost their conversion rates!

Facebook Ad Placement Options

Facebook advertising offers multiple options regarding where your ad will show up on a user’s interface. Choose from feed ads, group ads, right column, instant articles or in-stream video. Here are a few examples of what your Facebook ad would look like in each location:

Feed Ad

This particular ad reached 4.2 million people … yes, 4.2 million. It shows up in a user’s feed as if it were a post of someone they’re following.

What is PPC advertising and how does it work

Group/ Right Column Ad

This is a good example of an ad that pops up in a particular group. Coincidentally, group ads also appear in the right column, but as we can see, the ad shows up in this particular group due to the nature of the group page.

What is PPC advertising and how does it work

Instant Articles

Appearing only in the mobile app and messenger, instant articles are exactly that – articles that are instantly available at your fingertips. An instant article is a quick and interactive way for publishers to share material, and a unique opportunity for companies to attach their advertisements to.

In-stream Video

An in-stream video ad shows up, much like a commercial, for 5-15 seconds mid-roll in another publisher’s or digital first creator’s content. The targeting is audience based so two people watching the same video may not see the same ads.

Retargeting on Facebook

A powerhouse method to increase conversion rates, retargeting allows you to hone in on users who have already engaged with your website or previous ads, with a second round of targeted advertising. Focusing ads on this particular segment allows you to further nurture consumers who have expressed interest in the past.

While you won’t spend less on the PPC front for retargeting ads, your advertising is likely to be more effective with higher conversion rates.

Retargeting is accomplished by adding a line of code to your website via Facebook’s Custom Audiences feature which places a cookie on the devices that visit your site. This code then sends information back to Facebook that you can incorporate into your audience preferences. Pretty snazzy.

PPC Advertising on Instagram

Facebook and Instagram have very similar platforms when it comes to PPC advertising (FB owns IG), and you can even set up ads to run on both platforms without leaving Facebook. Instagram is a bit different from Facebook, however, in that it is predominantly utilized via mobile devices and there are no options for right-column or banner ads.

Instagram offers you options to advertise via:

•  Photo ads – photo ad appears in a user’s feed as a sponsored post, usually clickable

•  Video ads – same as photo ads but in video format which can be more effective in grabbing a user’s attention and holding it for longer as videos may be up to 60 seconds long.

•  Carousel ads – an interactive option, choose several photos that the user may scroll through to tell a story in a single ad

•  Stories ads – pop ads, up to 15 seconds long, in between people’s stories

Costs associated with this type of advertising aren’t necessarily on a PPC basis but rather a CPM (cost per impression) basis where you pay each time your ad is displayed up to a preset dollar amount.

There does seem to be quite a bit to learn when it comes to pay-per-click advertising, but it’s worth it to get a handle on everything these online ad options can offer. Choose just one type of PPC advertising and take your time putting together a marketing plan and analyzing the results. Once you’ve gotten your feet wet it will be cinch to broaden your PPC horizons.

ThriveHive combines easy-to-use tools and expert guidance to help businesses stand out and get found online. Learn more about our guided marketing and advertising solutions here.

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