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What Is PPC?

Pay-per-Click (PPC) lets you place your ads at the top of search engines. You use PPC by opening an account with Google's AdWords (their PPC service), Yahoo!'s Overture (their PPC service), and similar services. In the PPC account, you write small text ads, you add lists of keywords (when users search for those words, your ad will show up), and you set bids for the keywords. The more you bid, the higher your ad will appear in the search engines. When someone clicks on the ad, you pay (that's why it is called "pay per click"). The goal is for your ad to appear at the top of the search engines when your customer is looking to buy.

There are several major PPC services: Google AdWords, MSN adCenter, Yahoo! Search Marketing (formerly Overture), and There are several dozen smaller PPC services.

After consumers have finished the research phase of the buying cycle (this is explained in the book), they then begin to search for a vendor. They have decided what they want and now they are looking for a company that can deliver. PPC lets you place your ad with the product's name and price in front of the consumer. Best of all, you can place your ad at the top of Google. The people who click on these ads are highly qualified customers; they want to buy.

The purpose of PPC is to fit into the purchase phase. In PPC, you adjust the bids to place your ad at the top. You write ads to catch the buyer's eye. When the customer clicks the ad, she comes to a landing page where she is assured that she has found the product she is seeking and she can buy it now. You use web analytics tools to study the results and adjust the campaigns to improve the ROI and profits.

Paid Placement vs. Unpaid Links

There are two kinds of links in Google. The links are either unpaid (the ones on the left side that Google's computer finds and ranks) and the paid links on the right side.

At Google, the links on the right are the PPC paid listings. These ads are ranked according to bids from the advertisers. These are Google's AdWords.

Paid listings are separate from unpaid listings. You pay to be in the paid listings. However, this won't get you into the unpaid listings nor have any effect on your unpaid listing's ranking.

How PPC Works

Here's a quick overview of AdWords.

  1. You sign up for an AdWords account at Google.
  2. You create a small AdWords ad with a title, two lines of text, and the URL.
  3. You add a list of keywords that are relevant to your page.
  4. You set the daily maximum for your budget. If you set this at $20 per day, then Google will display your ads until you reach $20 in clicks and then it stops for the day. Google spreads the ads across the day, so it won't use up your entire budget in the morning.
  5. You place a bid for your keyword, for example, 12¢. If your competitor is #2 and you are #3, you increase your bid until your ad appears above him. This is an auction system: the more you bid, the higher your ad appears. If you want to be #1, just increase your bid. You pay for the click, which is why this is called Pay-per-Click.
  6. When someone types a search that matches your keyword, Google displays your ad in the results.

  7. The AdWords ads are displayed in the right column under Sponsored Links.

  8. Google displays eight ads per page. If you go to the second page, you'll see eight more ads.
  9. When a visitor clicks your ad, your website comes up.
  10. Google charges your account for the click. If you bid 12¢, Google charges you 12¢ for the click. (We explain the details in the book.)
  11. The account is linked to your credit card. Google deducts the total from your credit card at the end of the month.
  12. AdWords reporting tools shows you the number of clicks, the percentage of views vs. clicks, the cost per click, your ad's average position, whether the visitor was converted to buying, and other information.

Where Will Your Ads Appear?

When you advertise in Google AdWords, your ads appear in the following search engines and content sites that are affiliated with Google:

  • Search engines include: Google, AOL,,, Lycos, InfoSpace, Netscape, CompuServe, Earthlink, AT&T,, and others.
  • Content sites include: New York Times,, Forbes, ABC,, Fox,, Thomson, National Geographic, Linux World, All Recipes,, MacWorld,, The Weather Channel, Reed Business, Food Network, HGTV,,, and several million web pages in the AdSense network.
  • Other Google services: Your ads will also be displayed in Google services such as GMail (Google's free email), Google Groups, and so on.

For the other PPC engines (Yahoo, MSN adCenter,, the ads appear in their respective search engines. At Yahoo, ads are also shown in content sites.

PPC in the Book

In the book, we describe the Google Adwords tool in detail, along with strategies, tips, and tricks. We explain how the ads are ranked, how the bidding system works, and we give you strategies to get your ads at the top at the lowest cost-per-click. We also look briefly at Yahoo Overture, MSN adCenter, and The chapter concludes with interviews with the director of MSN adCenter and a senior dedicated account rep at Google.

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