PPC operates on an auction-based system, primarily on search engines like Google, Bing, and Yahoo. When a user conducts a search using specific keywords, the search engine initiates an auction among advertisers bidding on those keywords.
Advertisers select relevant keywords or phrases that they want their ads to appear for. These keywords are what users type into the search engine when looking for information, products, or services.
Advertisers create ads that are displayed alongside search results when someone searches for the chosen keywords. These ads typically consist of a headline, a URL, and ad copy describing the product or service being offered.
Advertisers set a maximum bid amount, which represents the maximum amount they are willing to pay for a click on their ad. However, the actual amount paid per click may be lower, depending on factors such as competition and ad quality.
Ad position is determined by a combination of bid amount and ad quality. Search engines use algorithms to evaluate the relevance and quality of ads to determine their placement on the search results page.
Advertisers set a daily or monthly budget to control their overall spending on PPC advertising. Once the budget is exhausted, ads will no longer be displayed until the budget is replenished.
PPC platforms offer various targeting options to help advertisers reach their desired audience. This includes geographic targeting, device targeting, demographic targeting, and more.
PPC campaigns are continuously monitored and optimized to improve performance. Advertisers track metrics such as click-through rate (CTR), conversion rate, cost per acquisition (CPA), and return on investment (ROI) to gauge the effectiveness of their campaigns and make necessary adjustments.