Pay per click

Pay per click (PPC) is an Internet advertising model used on search engines, advertising networks, and content websites, such as blogs, where advertisers only pay when a user actually clicks on an advertisement (ad) to visit the advertisers’ website. Advertisers bid on keyword phrases relevant to their target market. When a user types a keyword query matching an advertiser’s keyword list, or views a webpage with relevant content, the advertiser’s ads may be displayed. Such ads are called a sponsored links or sponsored ads, and appear adjacent to or above the “natural” or organic results on search engine results pages, or anywhere a webmaster or blogger chooses on a content page.

Although many pay per click providers exist, Google AdWords, Yahoo! Search Marketing, and Microsoft adCenter are the largest network operators as of 2007. Minimum prices per click, often referred to as costs per click (CPC), vary depending on the search engine and the level of competition for a particular phrase or keyword list — with some CPCs as low as US$0.01. Very popular search terms can cost much more on popular search engines. The PPC advertising model is open to abuse through click fraud, although Google and other search engines have implemented automated systems to guard against abusive clicks by competitors or corrupt webmasters.

Keyword-based PPC

Keyword pay per click advertisers bid on search terms — keywords consisting of words or phrases, and possibly product model numbers. When a user searches for a particular keyword, the list of advertiser links appears, where the ordering of those links is based on the amount bid for the given keyword. Keywords are the very heart of PPC advertising, and are guarded as highly-valued trade secrets by the advertisers. Many advertising firms offer software or services to help advertisers develop keyword strategies. Content Match, a service offered by Yahoo!, distributes the keyword ad to the search engine’s partner sites and/or publishers that have distribution agreements with the search engine company.