What is Pay Per Click?
Posted on 18. Aug, 2007 by ComCorp in Pay Per Click Marketing
Pay per click is a type of advertising medium used on advertising networks, search engines and websites. The advertiser selects certain keywords related to his or her product or service that are expected to be used as query terms by people using search engines. The advertiser agrees to pay some minimal amount, ranging from $.01 to $.50 for each time a searcher clicks on ads containing the selected keywords placed by the advertiser.
The expectation is that pay per click ads which appear within the top few listed to the right of the search results are more likely to be seen by and used by a searcher. In theory, a top pay per click ranking will result in increased web traffic and by extension more sales revenue visitors.
Popular keywords placed on one of the well-known search engines will cost more than more unusual key words. The three largest search engines who provide pay per click advertising at present are Google Adwords which captures about 50% of the market, Yahoo Search Marketing with about 22% and MSN Search which just completed beta testing.
A primary problem with the use of pay per click advertising is the potential for click fraud. Click fraud is illegal in many jurisdictions and search engine companies are the target of increasing litigation since they are the beneficiaries of the revenue generated by click fraud. The usual tactic of click fraud is for an unscrupulous merchant to click on his competitor’s ads even though he has no interest in purchasing a product. Depending on the price bid for the pay per click ad, such methods can rapidly deplete the competitor’s advertising budget with no real benefit in sales.
Search engines including Google and Yahoo have indicated their programming can detect and eliminate fraudulent pay per click transactions, but in fact, it’s difficult to determine if a transaction is genuine or not.
Pay per click engines usually are of one of three major types, product, service and keyword. Product search engines use databases supplied by their advertisers. When a customer uses the search engine to inquire about a particular product, the search engine pulls the appropriate information from the database of the advertiser and displays it as a search result ranked by the amount the advertiser pays per click.
Service search engines work in the same manner as product databases; only the feeds provided to the search engine are those of services rather than products. Search results are returned to the customer ranked by bid price, with the highest price paid by the advertiser at the top of the list.
Keyword search engines are the most commonly known and used of the search engines. This is the standard pay per click methodology where the advertiser selects and pays for keywords and the placement of the keywords on the search results list.
There has been some consideration to obtaining revenue from advertisers for displaying the pay per click ads, but at present revenue is generated only when the consumer actually clicks on the ad in question.
Please view the Pay Per Click Management services provided by ComCorp, Inc.
