In this installment of our Back to the Basics series we’re covering the basics of PPC and Google Adwords.
Breaking Down PPC
PPC, or Pay-Per-Click, is an online marketing model for ads. It works exactly as it says: You only pay when someone clicks. The amount you pay per click is called, not-at-all-shockingly, CPC, or Cost-Per-Click.
The most popular platform for PPC is Google Adwords. You know, those handy little ads that show up at the top and bottom of your Google searches.
How Google Adwords Works
Your ad position is where your ad shows up on the Google search results page – if it will at all. The higher your ad position the more likely you are to get clicks. Your ad position is determined by your ad rank.
Ad rank is the score you’re given to determine your ad position (as mentioned above). It is calculated using three different elements of your ad. These are:
- Bid Amount
- Quality Score
- Expected Impact of Extensions and Other Ad Formats
The bid amount is how much you are willing to pay for each click on your PPC ad. It does not reflect how much you will pay – just the maximum potential cost-per-click. Outbidding your competition does not necessarily mean you will achieve a higher ad rank in the end.
The quality score of your ad is made up of a number of different components. The most important of these are:
- Your click-through rate (CTR). (Yes, there are a ridiculous number of three-letter acronyms in the digital marketing universe.)
- The relevance of your ad.
- Landing page quality and relevance.
Your click-through rate shows Google that your ad is popular and has already generated a lot of traffic; in their eyes that makes your ad more relevant and trusted. By monitoring the relevance of your ad – by looking at things like ad copy – Google is able to make sure that ads not relevant to your search aren’t able to buy their way onto the page. The quality of your landing page is also taken into account. Google doesn’t want to send people to a page that isn’t going to help them in their search.
Expected Impact of Extensions and Other Ad Formats
Google also takes into account other extensions on your ads. This can be a phone extension, reviews, alternative page navigation and more. By formatting your ad to be as helpful to the searcher as possible, your ad can rank higher which will result in you being featured more prominently on the search results page.