eCommerce Glossary: Pay-per-Click Ads

Glossary

Paid Search, Keywords, Bidding, Ad Rank... What Does it All Mean?

What are PPC Campaigns and How do They Work?

You might be knowing that marketing is essential to your business. Have you heard about pay per click marketing? PPC campaigns help to market your products to a vast number of users. This article will help you to understand PPC and how it works for your business.

Pay Per Click is a kind of advertisement that allows advertisers to pay hosts for placing ads. Marketers place ads on the host's platform and pay every time visitors click. The main aim of Pay Per Click is to encourage the visitor to click on the ad and visit the advertiser's site. During this process, visitors can understand the product details and complete the sale. Search Engines are great advertisement platforms to display ads relevant to the audience. Bing ads and Google ads have real-time bidding (RTB) that sells ad inventory. This process conducts automatic bidding using real-time data and analytics.

There are different types of Pay Per Click, and the most common is the Paid Ad Search. When people look for commercial search, paid search ads appear on their search list. E.g. When someone is looking for restaurants near me, pizza near me, looking for a dentist, etc. All these searches launch pay per click ads.

Ad Auction is an automated bidding system. Advertisers must bid on relevant triggers or terms to attract more visitors to their website. These terms are keywords that are essential for the desired search ranking. E.g If your business is into a bicycle and if a user intent to buy a bicycle, they will search with the keyword ‘bicycle’ to get details.

If there is an ad spot on a search engine results page (SERP) auctions take place for that keyword. Auction begins when a user searches for a particular keyword. Once a search is initiated, Google picks advertisement winners from the pool of advertisers. The advertisers are chosen from many factors like the quality and relevance of keywords and ad campaigns. The size of the keyword bids also matters.

The winner of the ads and who appears on the search engine pages are based on an advertiser's ad rank. It is calculated by Quality score (a value that counts the click-through rate, relevance, and landing page quality) and the CPC bid (the highest amount an advertiser is ready to spend).

In this way, the system will permit winning advertisers to reach potential customers as per their budget. Advertisers can also decide where to display those ads to draw visitor attention. Accounts are segregated into different entities like the audience, product types, and campaigns, or other categories. This method facilitates easy management and reporting to generate the performance of keywords. Campaigns are of two ad group categories; Keywords & Relevant Ads.

Keywords

Keywords are an integral part of the pay-per-click activity. The keyword connects users to search query results.

Query - This is the entered word into the search engine to view the search results.
Keywords - Keywords are the words marketers use to target users corresponding to search. The keyword consists of a wide range of search queries with irregularities that includes spelling. Considering the keyword match, advertisers can rephrase their keywords on their website. Advertisers can match keywords to search queries, unlike spellings, or include long-tail keywords.

Develop and launch an ad campaign with a relevant keyword in your campaigns. They are organized into common themes and a shared set of keywords within an ad group. When an auction wins, the user can see that content on the search result page. Usually, an ad contains:

Headline
URL
Description

It is better to test the performance of different ad copy to understand the search engine rankings. Site Link extension helps to populate more links to pages on the site. Call extensions help to add contact details like phone numbers during business hours.

Budgets and Bids

Most of the advertisers and marketers set a budget before placing a bid on every keyword auction. Budgets are set on campaign levels. Bids are set at the keyword levels.

A budget that is set on campaign levels can be exceeded daily but will not be overspent at a monthly level. You can use bids to control ad spend.

Ad Rank

The highest bid doesn't ensure a high-ranking ad. The search engine looks for various criteria before placing an ad high on rank. Google Search Engines consider the following: Bid amount, Search context, Ad quality and relevance, Format impact (extensions can enhance ad format).

Quality Score determines the Ad relevance. The main components of Quality Score are:

Keyword relevance concerning the ad
Quality of landing page
Historical Click-through rate (CTR)
The relevance of the ad and keywords to the search query

An engaging and relevant ad encourages more visitors to the site. So, it is vital to have interactive contents that include high volume keywords. User experience is key for any website visitor so the landing page should be attractive and easy to load. Ad display will be fewer if a site's user experience is poor.

Targeting

The right keyword helps advertisers to show the relevant ad to the target user. Some of the target options to optimize the ad campaigns are:

Demographics
Day /Time
Locations
Device

Marketers can focus and target mobile users based on location and age profiles for example. The ad campaign may perform better in one group than in another. So, these targeting options add value to variations in ad copy for better performance.

Conversions

Developing interests and curiosity among visitors towards your product is key. Encouraging visitors to buy is the real test for any online business. Conversions are the actual test for online businesses and a pointer on ad efficiency. Some of the examples of conversions are:

Signing up for newsletter
Subscribing for email
Sharing contact details

To check the success of pay per click program it is a must to track conversion numbers. In this, you can check how many conversions resulted from paid searches compared to another medium. Google ads can track conversions by placing a code into the source code of the conversion page. Conversion tracking is difficult as it is beyond the click and later sale. As they include searches, website visits, email communication, phone call, or offline visit. Google Analytics can help to understand the conversion and conversion path.

Complete PPC campaigns run on keyword selection and built around keywords. So, if you have created an ad campaign, managing them on regular basis is important. To make an account successful, regular account activity and updating are key factors.