Some frequently asked questions on Pay per Click (PPC) advertising

 

Understanding your PPC report

Our PPC report is customised to reflect the data available to us. Where we have access to Analytics and conversion data this will be included. As a minimum your PPC reports include details of PPC ad impressions, clicks and costs.

Where we have access to visitor data (web stats, sales, and registrations etc) the report will also show traffic figures, proportion of PPC traffic, cost per visitor stats, cost per action, sales data and ROI figures.

Section: 'Year' 

This shows overall traffic and key performance indicators, such as bounce rate.

Section: Google Search Console / WMT 

This shows Google's statistics relating to your site's appearance in their search results.

Section: PPC Advertising Stats

Shows the performance of your advertising by network

Section: PPC Summary

Shows overall PPC performance, consolidating results of different networks

Section: Visitor Split

Shows split of traffic from paid (PPC) and unpaid (organic) sources

Section: Summary of Cost and Return

Shows 'value' of customer interaction with site, together with costs and Return on Investment (ROI) where we have the relevant information.

FAQs / Terminology

Custom Reporting

Where required we can create sophisticated reporting models to suit your specific requirements. Please ask us for details.

Are PPC ads only shown on the search engines?

No. All the major PPC programmes have "publisher programs". This is where ads are delivered through third party sites which then share in the click revenue. Perhaps the most common of these is the Google AdSense programme. This can be a very effective revenue generator for informational sites where they don't have a product for sale in the conventional sense, and where there isn't a conflict with the type of advert being shown.

From an advertiser perspective, it can be a very good way of extending the reach of adverts beyond the scope of the search engines and onto relevant information, directory, and comparison sites which they wouldn't realistically be able to reach in any other way.

There are some negative aspects to delivering ads through so called "content networks", but in the main the benefits outweigh the drawbacks.

Is bid price the only factor that controls PPC position?

Sadly not! Way back into ancient history that used to be the case with Yahoo! Paid search (formerly Overture, and before that GoTo), but now all the search engines apply "quality" filters to their search advertising algorithms.

Now the position your ads appear in is controlled by sophisticated algorithms applied to the ad 'auction'.

The search engines argue that their AI driven systems are designed to deliver the best results for advertisers, but it's important to remember that for all their altruistic "do no evil" rhetoric, Google (and the other search engines) rely on advertising revenue to survive, and their systems over the last few years have been honed to deliver the best possible return for THEM from a page of advertising, and not necessarily to deliver you, the advertiser, the best return.

That doesn't mean that their algorithms aren't working well for you as well, but blindly accepting their 'recommendations' is generally a good way to ramp up your spend without necessarily gaining as much benefit for yourself.

The key for efficient management of your budget is to understand how best to use their algorithms to your best advantage. Where your ads appear is based on a "quality" score - that's the primary mechanism for giving preference to some ads in favour of others. In it's most simplistic form, this works by calculating the return on individual ads: clicks x bid = return.*

For example, compare two ads: #1 delivers 100 clicks at £0.20, and #2 50 clicks at £0.30

100 x .20 = £20 return
50 x .30 = £15 return

Despite ad# 2 bidding 50% more than ad# 1, which do you think gets delivered more? Of course it's ad #1, as this delivers the best return to the search engine. This is justified on the basis that if more people click on the ad, then it must be more relevant and therefore "better". Of course this may well be true - clearly if more people click on one ad over another it must have more appeal.

From the ad#1 advertiser's perspective this is great - a win win scenario for both the advertiser and Google, twice as much traffic for only 50% more. 

But there are other bidding models to consider as well where the cost per click is calculated by the number of conversions, a conversion being some form of desired action taken by the visitor such as making a purchase, registering, or even simply spending a specified time on your site. With these bidding models you do not set a target cost per click, but a target CPA (cost per aquisition), leaving the algorithm to determine the 'best' position for your ads. BUT... set too low a CPA, and of course you can be outbid by competitors, and your ads will appear less frequently and or in a lower position. Google et all favouring their own pockets again!

Managing pay-per-click campaigns is now quite a complex business to make sure you are getting the right return.

If you need help with your PPC campaign management, request a free, no-obligation consultation

The actual calculation according to Google is Click Cost x Quality Score. The Quality Score is made up of a number of factors including relevancy of the search term to the content of the target landing page, but our practical experience indicates that click rate (and consequently Google's yield) is the most dominant factor.

How much does a click cost?

That very much depends upon the market and the competition. How it works is that advertisers select the keywords they wish to advertise for. In most markets there will be a number of advertisers competing against each other for the same terms. Advertisers can compete against each other for position by outbidding their rivals for what they are prepared to pay for a click.

The minimum bid value for a click can vary between £0.01p and £0.05p per click depending upon the network, but its rare that bid prices will stay anywhere near that figure. In some cases, bids can be £s rather than pence.

It is up to the individual advertisers to decide what they are prepared to bid based on factors such as their own ROI, lifetime customer value and the depth of their pockets!

What is pay per click advertising, and how does it work?

To most people using the internet, pay per click advertising is a common sight, although they might not recognise it as such, as most search engines more commonly identify PPC ads as the "Sponsored Listings" or "Featured Listings" that are highlighted at the top of the listing or displayed down the right hand side.

The reason they are known throughout the online advertising industry as "pay per click" or PPC ads is because of the mechanism used to purchase the space. Unlike "conventional" media where the space is purchased for a fixed amount, PPC ads are charged "per click". Advertisers do not pay for "impressions" (the number of times the advert is shown) but instead the advertiser is charged for the click when someone clicks on the advert.