How Does Pay Per Click Work? A Quick Marketer’s Guide

Just back rub it!

Before Google got its name, it was originally called BackRub. Can you imagine if instead of Googling things, we had to back rub it? 

Major search engines, like Google, are constantly evolving and making changes. Sometimes the new updates aren’t as obvious or easy to understand as a name change.

Questions like, “How does pay per click work?” or “What’s the importance of keywords?”, Are now popping up all over the internet. Marketers already know how powerful search engines can be in assisting their business.

Yet they’re not quite sure where they should invest their time and money. If you’re looking to invest in the best online advertising has to offer, you’ll need to stay up to date.

Read on to learn how PPC works, and why you need it.

How Does Pay Per Click Work

A pay per click advertisement, or PPC, is a specific type of online advertising model. In this model, the advertisers pay every time a user decides to click on one of the online ads they have.

There is more than one type of PPC ad. You could decide to do a display advertisement or remarketing strategy.

Yet, one of the most popular ones is the paid search ad. These ads will show up when individuals are conducting a commercial search.

In this event, a commercial search happens whenever someone is searching online for something to buy.

For example, if someone typed into their browser, “good shoes near me”, their search would trigger the PPC ad to appear.

Keep in mind, the businesses that are running the ads are only charged when someone actually clicks on the advertisement.

How Do Ads Show Up?

So how do the ads show up when someone is conducting a commercial search? The search results page, or SERP, shows up once someone enters in their searching criteria.

In the example above, using “good shoes near me”, the SERP would list different local shoe stores.

Advertisers don’t have the option to pay more than their competitors to ensure their ads show first. Instead, the advertisements have to go through a process known as an Ad Auction.

Ad Auctions refer to an automated process that Google uses to deliver quality results. They will review the relevancy of the advertisement in relation to what the user’s searching for.

They will also be checking to see if the advertisements are valid and true.

Why Keywords Matter

So how do major search engines, like Google, conduct their automated Ad Auctions?

Similar to a normal auction, the search engine will be taking bids. Advertisers have to place bids on the keywords that assist their products the most.

For example, someone who owns a shoe store might bid on keywords like, “sneakers”, or “footwear”. The idea is to pick words users will use when trying to find something to buy.

Advertisers have to learn and decide what keywords they’ll use and how much they’re willing to bid. They can also create groupings of different keywords to pair with ads.

Next, Google (or whatever main search engine is at work), will look at all of the keywords the advertisers bid on. It’ll then determine what keyword is most relevant, and enter it into the auction.

Once you’re in the auction, Google will look at your maximum bid and your quality score. The content with the highest rank will appear at the top of the SERP.

If the user decides to click on your advertisement, you’ll owe the search engine a specific fee, or pay per click.

The price you’ll pay depends on the ad rank of the person below you. It’ll also take into account your quality score.

Exploring Affiliate Marketing

Now you know the answer to your question, “how does pay per click work?”. Yet, your journey into learning about affiliate marketing is far from being over.

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