PPC. SERP. CPC. CPM. ROI. ROAS. WOOW!*
For real though, wow! Our industry is full of acronyms, so it’s understandable if you feel overwhelmed by jargon at times.
I’m fortunate enough to work as the Client Success Manager at Pink Orange, meaning I get to be a generalist in many disciplines across the vast expanse that is digital. The main function of my job is to help our digital specialists and clients work together to reach a common understanding of what success looks like. And a big part of that is demystifying digital-speak.
It’s challenging, but it means getting to learn multiple “languages.” From digital media and search to digital creative, motion graphics, development, animation programmatic, CPM, data, analytics, and yes, becoming the PPC marketing guide.
Here’s your PPC beginner’s guide
Pay-per-click (PPC) is an advertising model that allows marketers to place adverts on an advertising platform and pay the host of that platform every time their ad is clicked. (I will use the term “ad” moving forward, to shorten the word advert/advertising.)
The objective of a PPC ad is to steer the person viewing it to the advertiser’s website, where that visitor can complete a valuable action, like buying a product or service.
Search engines are wildly popular ad platforms. They allow you to display ads that are relevant to what users are searching for.
Advertising services like Google AdWords operate with real-time bidding (RTB is a topic for another blog!), where advertising “inventory” is sold in a private, automated auction using real-time data.
How does paid search work?
Whenever there is an ad spot on a search engine results page (SERP), an immediate auction takes place for the keyword or words contained in that ad.
A combination of multiple factors, including the bid amount and quality of the ad, determines the winner whose ad will appear in the top spot of the SERP.
These auctions are basically what keep the PPC gears moving
Auctions start when someone searches for something on a search engine like Google. If there are advertisers interested in showing ads related to that user’s search query, an auction is triggered based on keywords that are bid on by advertisers. The ads that win the auction then appear on the search engine results page.
To participate in these auctions, advertisers utilize accounts on platforms like AdWords to set up their ads and set up where and when they would like the ads to appear.
For ease of management and reporting, the accounts are split into campaigns with different locations, product types, and other useful categorizations. Campaigns can be further divided into ad groups that contain keywords and relevant ads.
Queries are the actual words that users type into the search box of a search engine to find results.
Keywords, however, are what is used to target these users by matching their search queries.
Based on the keyword match types used, advertisers can match search queries with greater or lesser precision
Together with keywords, you have to prepare ads for your campaigns. These are bundled together within ad groups that target shared sets of keywords and are organized by common themes.
Ads are what the target audience will see if the auction is won, so they are very important to get right.
Budgets & bids
To take part in the auction, advertisers have to determine how much they’re willing to spend on a given keyword. How is this done? Well, budgets are set at the campaign level, however, they can be exceeded daily, but will not be overspent monthly. Budgets must be set according to the overall account strategy, but bids are a more precise way of controlling spending.
Every ad group must have bids, but keyword-level bids overthrow ad group-level bids.
Because of the RTB system, the actual amount paid by the advertiser hinges on competitor activity and ad rank, not just the maximum bid.
Having the highest bid does not equate to winning the auction, there is more to it. Search engines look at other factors to govern which ads should be at the top and the most valuable spot on the SERP.
Different search engines have their own specific ways of factoring in other components to govern ad rank. Google, for instance, considers “Quality Score.” Quality Score is a metric that determines the ad’s relevance to the user’s search. Ad relevance is absolutely essential, and the higher the Quality Score, the lower the CPC (cost-per-click) will be.
Selecting the right keywords is what qualifies advertisers to show ads to relevant audiences.
There are numerous targeting options including audience targeting and content targeting. However, these targeting options are a whole other blog of their own.
PPC advertising exists on many other platforms like Facebook, Twitter, etc. In practice, targeting options differ slightly, so for the purpose of this introductory blog, I used Google as an example. It’s a lot to take in, I know. That’s why we understand the value of having an expert team to help you navigate the world of digital advertising. If you have any questions or you need help with your digital strategy, feel free to drop me an email or arrange a free consultation with the Pink Orange team.