Contextual advertising by Google. Website publishers earn a portion of the advertising revenue for placing Google sponsored links on their site.
There is also a number of options with this type of advertising;
Pay–per–click (PPC), also known as cost per click (CPC), is an internet advertising model used to direct traffic to websites, in which an advertiser pays a publisher (typically a website owner or a network of websites) when the ad is clicked.
Cost Per Click (CPC) refers to the actual price you pay for each click in your pay-per-click (PPC) marketing campaigns. In this lesson you’ll learn:
- A more thorough definition of cost per click.
- Why CPC is important to you and your PPC campaigns.
- How to lower your cost per click while maintaining (or even improving) traffic and conversion levels.
A “click” on one of your PPC text ads represents a visit, or an interaction with your company’s product or service offering. Every click in a PPC campaign represents attention from a person who is searching for something that you offer. This attention is what you’re buying, as an advertiser, so it’s important to note two factors:
- What type of attention you’re going after, and
- How much you’re paying for it.
How Is Cost Per Click Calculated?
The actual formula for cost per click in AdWords is:
As an advertiser, your cost per click will always be less than or equal to your maximum bid, as it is an average of bids against a series of competitors over a period of time. Because of how Google’s Adwords auction works, your actual cost per click is heavily influenced by both you and your closest competitor’s ad rank, maximum bid, and Quality Score.
Pay Per Impression (usually per 1000)?
What is an impression?
An impression is counted each time your ad is shown on a search result page or other site on the Google Network.
- Each time that your ad appears on Google or the Google Network, it’s counted as one impression.
- In some cases, only a section of your ad may be shown. For example, in Google Maps, we may show only your business name and location or only your business name and the first line of your ad text.
- However, when someone searches using Google Instant, an impression can be counted when one of these occur:
- Person begins to type and then clicks anywhere on the page like a search result, ad or related search
- Person types a search and then clicks the “Search” button, presses Enter or selects a predicted query from the drop-down menu
- Person stops typing, and the results are displayed for a minimum of three seconds
- You’ll sometimes see the abbreviation “Impr” in your account showing the number of impressions for your ad.
As you can see Google Adwords is a complex method and you can see why many people can lose a lot of money and not get any results or ROI.
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