ppc

PPC is an acronym in Internet advertising that stands for pay per click, which is a means to direct traffic to websites where advertisers pay the publisher whenever the ad is clicked on by a visitor.

With search engines, internet advertisers usually have to choose and bid on a keyword that is relevant to their target market, yet with pay per click advertising, the publishers will charge a fixed price for each click. Pay per click ads are only displayed on websites and search engine result pages that are relevant to the user's current search, meaning that ads about products or services that are not related to the search will not be displayed.

The purpose of pay per click ads is to garner purchase opportunities when people are surfing the internet. Consequently, businesses may use the affiliate model, by which a certain percentage of their revenue is offered to partner websites. Affiliates will often display ads that are purchase points to the merchant (for example a banner inviting you to add a specific product to a virtual shopping cart). Performance is encouraged and rewarded in the process, since if affiliates do not generate sales, the merchant does not need to pay them.

The pay per click advertising model is often targeted by click fraud, which occurs when a person or computer script attempts to create illegitimate clicks with the purpose of generating a charge for the merchant. Some search engines, however, have implemented security systems that prevent abusive clicks.

When establishing costs, the advertiser will first look at the type of potential customer they're aiming to attract to the website and what are the short term and long term revenues that can be made. Pay per click cost can be determined using two main models, namely the flat-rate and bid-based model.

In the flat-rate model, the advertiser and publisher agree upon a fix sum that will be paid for each click. Most advertisers will offer different rates based on the keyword targeted by the ad.

In the bid-based model, the advertiser will be competing against other advertisers in a private auction on an advertising network. Advertisers will let the publisher know what the maximum amount is that they're willing to pay for an ad spot. When a visitor triggers the ad spot, the auction pays out automatically.

You'll find bloggers talking about PPC at sites like Google Blog.

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Original Technorati articles tagged “ppc”

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