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How Do PPC Ads Make Money?

ppc

Pay-per-click advertising has proven to be one of the most efficient and cost-effective internet marketing techniques over time. PPC advertising helps businesses to control their ad expenses and get their products in front of the right people at the right place and time.

In this article, we explore some of the ways that PPC allows businesses to make money, ranging from reaching out to consumers directly, or simply staying top-of-mind. We also revisit what PPC is and what exactly makes it so popular among digital marketers.

What is PPC?

PPC marketing is a sponsored search strategy for increasing brand exposure, promoting product offers, and gaining quick traction with specified target audiences.

The most common types of PPC include search advertisements, such as those that appear when you search something on Google or Bing, as well as display ads and social media sponsored posts.

How PPC works in each of these styles varies, but the essential function of paying for each ad click is the same in all of them. Advertisers only pay for PPC advertising when a user clicks on them, hence the name “pay-per-click.”

Let’s take Google Ads as an example. Google Ads is the most widely used PPC advertising system on the planet. Businesses use the platform to create advertisements that are then displayed on Google’s search engine and other Google domains.

PPC marketers bid on keywords and then pay for each click that their ads receive. When a user performs a search, Google looks through its pool of Ads advertisers and selects a few winners to appear in the premium ad space on the search results page.

The “winners” are determined by a number of criteria, including the quality and relevance of their keywords and ad campaigns, as well as the size of their keyword bids. This means that while money is a factor, ad quality is just as, if not more important.

This system sees digital marketers attaining high ROI. If a marketer wants to move an item worth $200, they earn $195 off a $5 PPC bid if the user winds up buying the item. Of course, actual bids tend to be much lower—averaging at around $1-2 on Google Ads—making this a scalable tactic that can see hundreds of thousands of clicks earned off a relatively modest budget.

The key advantage of PPC marketing is that it is usually regarded as one of the most effective kinds of web advertising.

It provides rapid results and consistent returns, and it is also one of the most widely used advertising methods. It increases a company’s visibility on search engines such as Google and Bing, and PPC visitors are more likely to convert since they’re usually served ads that directly address their search intent.

How can a business earn through PPC?

As you can imagine, there are many different ways that the average business can benefit from PPC ads.

It used to be a big problem for advertisers to put up their materials (whether those were print ads, radio ads, or TV spots) where their would-be customers could see them. Traditional marketing was a numbers game: cast a wide enough net, and you’re bound to catch a few fish.

PPC ads are a precise subset of marketing that allows marketers to set specific parameters for the people who see their ads. If traditional marketing were fishing with a net, then PPC ads are fishing with spears—lots and lots of very accurate spears.

Instead of crossing your fingers and hoping a willing customer would chance upon your ads, you can design ads and pair them to keywords that clearly indicate an intent to purchase. While it’s a viable strategy to try and compete for a short-tail keyword like barber shop, smaller businesses with more modest budgets can compete for medium to long-tail keywords like barber shop in Jumeirah.

Display Network ads

Google’s Display Network is another powerful tool for PPC marketing. It’s a subset of its wider Google Ads platform that allows marketers to host banner ads and other visual ppc ad material on places around the internet. Businesses that are able to create compelling visual ads and match them to the right types of websites can see great success from this form of PPC advertising.

One thing that makes display ads stand out because they’re often paired with remarketing tactics: digital tags that allow Google to serve ads based on a user’s previous web activity. For instance, it’s possible for a shoe brand to remarket running shoes to users who’ve recently searched for jogging routes, or who have spent time on websites with a focus on athletics.

Social media marketing

As we’ve mentioned, part of social media management can include ad management: using platforms like Facebook or Twitter to run ads that, similar to what we’ve mentioned, reach very specific sets of users. 

While quality definitely matters for Google Ads, social media ads rely heavily on a marketer’s ability to speak the language of their target customers: if content isn’t immediately interesting, chances are it’ll fail to deliver returns in the long run. This makes it important to partner with an agency or marketer that understands people’s behavior on social media.

Likewise, platforms like Facebook’s Business Suite can be tricky to master when it comes to defining audiences, running tests to see what types of ads work best, and reporting on results. It’s a challenge to say the least, but for the businesses that overcome it, it’s also a steady driver of marketing ROI.

Conclusion

PPC advertising continues to be a powerful digital marketing tool for businesses in 2022. They allow for low-cost and high-impact lead sourcing, and reward businesses that know exactly how best to speak to their target customer base.

If your business is interested in unlocking higher levels of growth through PPC ads, or if you’ve been struggling to find the best way to get your ads to yield returns, reach out to us at Igloo to learn how our combined decades of expertise can transform your business.

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