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Pay-Per-Click (PPC) Programs

From the advertiser's point of view, the obvious advantages of investing in Organic SEO is that you don't have to pay a set fee each time your search result is viewed, as you do, for example, with a paid listing bought on a CPC basis.

The big selling point on PPC listings is that the position of your listing is guaranteed until your ad contract expires. Search engine listings fluctuate, and advertisers have little control over the position they retain over time. If your competitor is bumped to a higher ranking on a search engine, there isn't much you can do about it with Organic SEO. But if you are participating in an effective PPC program, you can be listed under the same keywords as your competitors.

From the standpoint of most advertisers, a visitor is valuable to a site only if he or she is qualified, meaning that the user's interests are relevant to the content, product, or service offered by a web site. Naturally, targeted ad placements are usually the key to attracting a highly relevant audience to a site.

In terms of targeting, there are no placements as effective as those on search engines, whether it's a strong ranking within the search results or a keyword-relevant banner that appears along with the results. When a user is performing a search, he or she is looking for something specific. By displaying a search result or an ad at the time when the user is looking for something relevant, you substantially improve your odds of bringing a highly qualified user to your site, one that is likely to convert (into a new regular visitor or even follow through with an online purchase). It is for this reason that advertisers pay for keyword-related ads/placements and work countless hours trying to optimize their search-result rankings with the major search engines.

Who's on first?

The two most popular pay-for-position (or cost-per-click) engines are Overture and Google. While both offer a CPC model, each have a different approach. On Overture , advertisers choose their priority listing in the search results by bidding for placement, with the highest paying advertiser's site appearing first in the results (bid system). Each advertiser pays the amount of its bid whenever a consumer clicks on an advertiser's listing in the search results.

Google on the other hand offers a cost per click model based on keyword availability and positioning. A much-talked-about development with AdWords is the “content targeting” initiative. Google AdWords ads are now placed on relevant pages (“on the fly,” using proprietary matching technology which matches advertisers' keywords to content on the page) on major publishers' sites (CBS Marketwatch, About.com, Amazon.com, The New York Times, Google Groups, alexa.com, epinions, and the list goes on). In addition to this, Google now does the same thing with smaller publishers who
qualify for their AdSense program. Ads are being served in more places since they are placed in relevant AdSense pages.

These programs are frequently described as pay-for-performance, pay-per-click, pay-for-position, or pay-for-placement. Basically, they let advertisers choose their own positioning in the search results by paying for placement. Generally, the highest paying advertiser's web site appears first in the results. Lower bidders follow. Remember that you only pay your bid amount whenever a customer clicks on the your listing in the search results. Below are some of the benefits and drawbacks.

Benefits
  • Your web site is instantly ranked number one (or two or three, depending on your bid) in the engine database
  • You only pay your bid amount when a user clicks the link and visits your web site
  • You can add or remove keywords at anytime, instantly changing your position
  • You're ranked high in the engine where users are searching for your specific product, service or information, therefore get highly qualified traffic, not those 'tire-kickers' or curious surfers
  • You can start, stop, or re-start your campaigns whenever you want, so you have complete control over your budget
  • The cost of entry is low with Cost Per Click rates starting typically at 5 ¢
  • You have control over the creative message-- your ads appear with the description/display text exactly as you want it
  • You can test various titles, descriptions, and positions
  • Changes are usually instantaneous