Paid Search, also known as PPC Advertising or SEM, is an effective intent-based digital marketing tactic. The vertical has many different acronyms, which can sometimes be overwhelming when you are new to the field. To help you understand the basics of Paid Search, we answered a few common questions below.
What does SEM mean?
Search Engine Marketing, also known as Paid Search or PPC advertising, is a practice of digital marketing that buys advertisements that appear on a search engine result pages (SERP). See below for an example of a search ad on the Google SERP:
What does PPC stand for?
Pay Per Click is a digital advertising method where a company only pays when a user clicks on their ad. For example, imagine you are a company called ‘bestlizards.com’ and you want to drive more users to your site. You could use PPC to show your ad when someone searches for ‘lizards in bulk online’ by bidding on that search term. Your ad shows at the top section of the search results, and you only pay when a user clicks through to your site.
What does CPC stand for?
Cost-Per-Click is the amount you pay when someone clicks on your ad. CPC = Advertising Cost/Clicks.
For Manual CPC bidding campaigns, you set a maximum cost-per-click bid (Max. CPC) for the highest amount you are willing to pay per click on your ad. Max. CPC is the highest you can be charged for the click, but you will often be charged less – sometimes much less if there is little competition on the keyword.
For Automatic bidding campaigns, Google and/or Bing will set the bids to get the most clicks within your set budget. This often leads to higher CPCs but lower conversion (lead, purchase, sign up) costs.
What is the relationship between PPC and CPC?
Pay Per Click (PPC) is used to describe a type of advertising model where you pay for each click, whereas Cost-Per-Click (CPC) is used to calculate how much was paid for each click.
What is a PPC Campaign?
Let’s go back to our example company ‘Best Lizards’ for an example PPC campaign structure:
Best Lizards wants to improve conversion and reduce costs by making targeted campaigns for each Reptile species. The product example in the chart above shows one campaign for Best Lizards selection of iguanas. They sell three age groups of iguanas and want to make sure they are driving the consumer to relevant landing pages at the best costs. For example, a search for ‘juvenile iguana’ would show an ad mentioning juvenile iguanas.
PPC campaign structure continued:
- Budgets are usually set at the campaign level.
- In our Best Lizards example, the Iguana campaign drives the most sales, so Best Lizards spends the most budget on that campaign
- The ad copy is set at the ad group level. Best practice is to have at least three variations of ad copy in each ad group.
- In the example above, Best Lizards tailors their ad copy and landing pages to the type of iguana’s consumers are looking for. This tactic helps drive lower CPC costs and directs the consumer to the correct product page.
- Similar keywords are grouped into their own ad groups.
- CPCs are managed at the Keyword level.
To Sum It All Up
In today’s day in age, PPC marketing is a necessary channel for any digital marketing strategy. Both on its own and when complementing an SEO campaign, PPC marketing can drive relevant traffic to your website and increase your site’s visibility in the search engine.
Do you have a PPC question that wasn’t answered above? Please reach out and we will be happy to answer your question and add it to the above post!
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