Common Pay Per Click Terms
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by: kgmarkd
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Pay Per Click (PPC) was a concept developed by Overture formerly known as GoTo.com. Today Overture is owned by Yahoo, making up its PPC division known as Yahoo Search Marketing. However Adword, Google's PPC division is the most popular of all the PPCs. Microsoft is also working on its own version, but is up to a slow start.
Unlike Search Engine Optimisation (SEO), PPC depends on ones ability to bid to position higher than their competitor. The paid listings are served back together with the organic search results in the Search Engine Results Page (SERP) after a search query. The PPC listings also referred to as sponsored listings or paid results appear on the left of the SERP.
PPC is arguably the fastest way to enter into the internet market. But unlike SEO it will cost you. Though it can be said to be a fast entry to market, it also can be the fastest way to burn a big hole in your wallet.
But before we look at the intricacies of how PPCs work to make you money, let's first get familiar with the more common terms of the trade.
Impressions: This is the number of times an advert is displayed to your target market. The higher the number of impression the more prospects will see your advertisement.
CTR: Click Through Rate is a ratio that is often stated as a percentage. It is the rate at which impressions of your adverts have resulted to a click. For example a CTR of 20% means that for every 100 impressions of your advert there were 20 clicks that lead visitors to your site.
CPC: Cost Per Click is the price that you as an advertiser will pay for each click of your advert. This is a number to watch as it determines the cost of reaching your market.
CPM: Cost Per Milli is the cost of one thousand impressions. This is an alternative way to buy advertisements in PPC. As opposed to paying per click (CPC), you may chose to pay for every thousand advertisements displayed regardless of if they are clicked on or not.
CPA: Cost Per Action is another alternative means to buy or pay for your advertisements. Only this time you only pay if a visitor clicks into your site and takes a particular action. This action may be making a purchase or filling a form.
CR: Conversion Rate is the ratio of visitors sent to your site that take the desired action
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