What Is PPC? A Starter Guide to Pay-Per-Click Marketing

What Is PPC?

Pay-per-click (PPC) marketing is a type of digital advertising that involves paying a fee each time someone clicks on your ads. 

This means PPC is typically more cost-effective compared to advertising models that involve paying based on views or impressions that might not lead to any interactions.

Depending on your advertising platform, PPC ads can appear in the following places:

• Search engines like Google and Bing
• Social media platforms like Facebook, Instagram, LinkedIn, and TikTok
• Banners on websites
• Videos on YouTube
• Marketplaces like Amazon and Etsy

If you run PPC search ads for cat food, your ad might appear on Google’s search engine results pages (SERPs) like this: 

If you set a budget of $1 per click and 100 people click on your ad, you’ll pay $100.

PPC vs. SEO vs. SEM

PPC is a type of advertising that involves paying for each click on your ads and is most commonly associated with ads that appear in search engines.

Search engine optimization (SEO) is a practice that involves making improvements to increase your site’s visibility in search engines’ organic (unpaid) results.

They both fall under the umbrella of search engine marketing (SEM),assuming you’re talking about PPC search ads. 

But there are some major differences between SEO and PPC. Like:

• The time it takes to see results: With PPC, your ads appear once the campaign is live. But SEO takes time to build up organic rankings and achieve long-term visibility.
• The goal: PPC is effective for quick, short-term results. And SEO is geared toward sustainable, long-term traffic.
• Your targeting options: PPC allows specific audience targeting (like based on search terms, audience demographics, and audience online behaviors). But SEO doesn’t target users directly beyond keywords.

Generally, businesses see the best results when they align SEO and PPC in their marketing strategies. 

Why Is PPC Important?

The main benefits of PPC ads are that they:

• Offer specific targeting: PPC lets you reach highly specific audiences through targeting based on demographics, keywords (usually), and behavior. You can even target users who previously visited your site or interacted with you on social media.
• Can deliver fast results: With PPC, you can start driving traffic soon after you start your campaign
• Are generally cost-effective: With PPC, you only pay for interested users who take action by clicking. You can also control your budget and determine your cost per click (CPC) in advance.
• Are easy to measure and track: Ad platforms allow you to easily track PPC metrics. Like how many people clicked on your ads and what they did from there.
• Allow for easy management: Changing your CPC, strategy, and other elements is simple when you manage a PPC campaign through an ad platform. For example, you can boost the budget of ads that are performing well.
• Can boost brand awareness: Even when users don’t click on your ads, they can still see your brand and message. And they may be more likely to engage with you later on.
• Often complement SEO: Search engine PPC ads work well alongside SEO by letting you occupy more screen space in search engine results. Which is likely to drive more traffic and sales overall. 

How Does PPC Work?

Pay-per-click advertising uses a pretty straightforward process:

1. Sign up for an advertising account with a platform you want to run ads on. Like Google Ads or Meta Ads Manager.
2. Set your overall budget and how much you’re willing to pay for each click
3. Create your ad copy and include visual assets like images/videos as applicable
4. Send your ad into an auction with other advertisers who are bidding on the same keywords or targeting criteria
5. Wait for the auction to determine whose ads will be shown—and where
6. Pay whenever someone clicks your ad

The exact process depends on your platform and ad format. But the main principles remain.

5 Types of PPC Ads

When you run a PPC campaign, you have a wide choice of different ad formats that can vary by platform, including:

Search Ads

Search ads are text-based ads that appear in search engines like Google and Bing when users enter a query. 

These ads usually show at the top or bottom of the SERP and are labeled as “Sponsored” or “Ad.” 

For example, here’s an ad that appears for the search term “best project management platform”:

Search ads provide immediate visibility among users actively searching for products or services related to your business. 

Display Ads

Display ads are most commonly run through Google Ads and are banner- or image-based ads that appear across a wide range of websites within the Google Display Network (GDN) and other partner sites/apps. 

They’re shown based on users’ browsing behavior, interests, and other targeting criteria the advertiser selected.

Here’s an example of a display ad on Forbes:

Display ads are particularly good for increasing brand awareness.

Video Ads

Video ads appear across the web and platforms like YouTube, LinkedIn, and Instagram. 

Here’s an example of a video ad on LinkedIn:

Video ads are particularly effective for telling a story or delivering more complex messages in an engaging format.

Further reading: The Ultimate Beginner‘s Guide to YouTube Ad Targeting

Retargeting Ads

Retargeting ads (Google calls them remarketing ads) are delivered to users who previously visited your website or interacted with your content but didn’t complete a desired action (like making a purchase). 

Here’s a visual representation of how retargeting ads work:

If someone visited your online store, added a pair of shoes to their cart, but left without completing the purchase, you can use remarketing ads to show those same shoes to them via a PPC ad.

Here’s an example of how lifestyle accessories brand DailyObjects retargets users on Instagram:

Retargeting ads are great for encouraging repeat visits/interactions and increasing conversions.

Shopping Ads

Shopping ads are visually rich product ads that appear in search results and Google’s Shopping tab. 

For example, here’s what users might see if they search for standing desks: 

Shopping ads are particularly effective for ecommerce businesses because they target people who are actively looking for specific products.

5 PPC Advertising Platforms 

Here are some of the most well-known PPC platforms:

Google Ads

Google Ads is the largest PPC platform (their market share is 39%) and allows you to run ads across the entire Google Network, which includes:

• Google’s search results pages
• Google-owned platforms like YouTube and Google Maps
• Thirty-five million third-party websites and apps that make up the Google Display Network (GDN)

There are six types of Google Ads campaigns you can choose from, including search, display, shopping, and video.

Google Ads lets you reach those most likely to convert by bidding on specific keywords, ensuring your ads appear in relevant search results. 

Additionally, you can target audience segments—groups of people with specific characteristics or behaviors in common—to further refine who sees your ads.

Meta Ads

Meta Ads Manager allows you to run PPC ads on both Facebook and Instagram.

Here’s an example of an ad on Facebook:

You can tell this is a paid social ad because it says “Sponsored” in the top left corner. 

With Meta Ads Manager, you can create ads in a variety of formats including image, video, and carousel (swipe through multiple images or videos within one ad).

Meta offers very specific targeting options based on demographics and interests, which enables brands to tap into a pool of likely customers.

Further reading: Facebook Advertising: How to Run Campaigns on Facebook

TikTok Ads 

TikTok allows you to run short-form video advertisements on the platform. 

Here’s an example of what a TikTok ad looks like:

Advertising options include in-feed ads (ads that appear in users’ feeds as they’re scrolling) and TopView ads (full-screen ads that appear as soon as a user opens the TikTok app).

TikTok is particularly popular among younger audiences, making it an ideal platform for brands looking to engage with Gen Z and millennial users through creative and engaging content.

Microsoft Ads

Microsoft Ads enables you to extend your search engine reach beyond Google by displaying ads across the Microsoft Advertising Network, which includes:

• Bing, Yahoo, and MSN search engine results 
• Microsoft-owned properties like Outlook and Microsoft 365
• Bing and Yahoo search partners like Ask.com and Forbes 

Here’s an example of a shopping ad on Bing:

Some ad types you can run on Microsoft Ads include search, display, video, and shopping.

LinkedIn Ads

With LinkedIn Ads, you can reach over 1 billion active professionals on the largest social media platform for professional networking. 

Here’s an example of an ad on LinkedIn:

With LinkedIn, you can run a variety of ad types like text ads, sponsored messaging, and sponsored content (ads that appear in users’ feeds).

LinkedIn Ads offers advanced targeting options based on job title, employer, industry, and professional skills—making it ideal for B2B marketing.

How to Start a PPC Campaign

The exact steps to plan a PPC campaign depend on the platform you use, but you’ll always follow these seven general steps:

1. Set Goals

Your PPC objectives will guide every decision about things like keyword selection, ad copy, and even how and when your ad is shown. 

Start by defining your desired outcome. This might be increasing traffic to your site, driving more purchases, generating leads, or driving brand awareness. 

Here’s what selecting a goal looks like on Microsoft Ads:

Next, determine which metrics to track based on the goal you set, so you can measure your performance.

Some common metrics to track include:

• Click-through rate (CTR) for traffic-related goals
• Conversion rate (the percentage of visitors who take a desired action) for sales and lead generation
• Impressions for brand awareness campaigns
• Engagement rate for traffic and brand awareness campaigns 

2. Do Preliminary Research

Before setting up your campaign, lay the groundwork with competitor and keyword research, so you don’t have to interrupt working on your ads mid-setup.

First, use Semrush’s Advertising Research tool to review your competitors’ ad copy. And get inspired. 

Open the tool, enter a competitor’s domain name, select the country you plan to target, and click “Search.”

Navigate to the “Ads Copies” tab to see the exact copy your competitor is using in search ads they’re running.

Click on each ad’s headline to check out your competitor’s ad landing pages. And see how they attempt to engage visitors and drive conversions.

If you’re using Meta Ads, view your competitors’ work through the Meta Ads Library. Just choose an ad type and enter their brand name.

For LinkedIn Ads, visit the LinkedIn Ad Library and search by advertiser name or keyword. Like this:

If you’re running a keyword-focused campaign, conduct PPC keyword research next. This helps your ads reach people actively searching for your offerings.

Do this with Semrush’s Keyword Magic Tool. 

Just open the tool and enter a single seed keyword (a broad term related to your intended ad campaign) in the bar. 

Click “Search,” and the tool will generate potentially thousands of keyword suggestions for you to review.

Once your report is ready, you’ll see a list of keyword ideas. 

To ensure you’re focused on terms that are best suited for PPC campaigns, click the “Intent” drop-down, check the boxes next to “Commercial” and “Transactional” (these represent terms that user search when they’re getting ready to make a purchase), and click “Apply.”

Take a look at the narrowed list and consider these metrics:

• Search volume: This is the average number of monthly searches a term gets. Aim for terms that get a decent volume (at least 100 searches per month).
• Competitive density: This is a number between 0 and 1 that shows how competitive a keyword is. Consider terms with lower scores to increase the chances of your ads appearing.
• CPC: This is the average amount advertisers pay for a click on ads targeting this term. Consider keywords with a lower CPC to maximize the number of clicks while staying within your budget. Choose higher CPC keywords if you think they have the potential to be valuable and high-performing.

Use everything you learn during this stage to inform the rest of your campaign. 

3. Set a Budget and Choose a Bidding Strategy

Your bidding strategy controls how much you pay for clicks, and it often depends on the goal you set for your campaign.

It’s common to use a CPC-focused bidding strategy, where you pay for each click to drive traffic to your intended destination. 

But other common types are based on impressions and views (like cost per thousand impressions) or conversions (like cost per action).

Most platforms also offer both manual bidding (which lets you set specific bid amounts) and automated bidding (when the platform adjusts bids based on your goals).

Here’s what it can look like to set a bidding strategy using LinkedIn Ads:

Once you’ve picked your bidding strategy, determine how much you're willing to spend on your campaign. 

Some platforms like Google Ads and LinkedIn Ads automatically suggest an average daily budget based on your campaign settings.

But you can also set up a custom budget.

To calculate your daily budget, divide your total monthly advertising budget by 30.4—the average number of days in a month.

So, if your monthly budget is $1,000, your daily budget is $32.89. 

4. Define YourTarget Audience 

Every advertising platform offers different targeting options to help you reach highly specific audiences to ensure the best results.

Some common targeting options include:

• Demographics: Information about age, gender, location (which can be as broad as a country or as specific as a particular zip code), etc.
• Socioeconomics: Information about income, household size, education level, etc.
• Interests and behaviors: Information about hobbies, activities, purchasing behaviors, online interactions, etc.

Depending on your platform, you can also create highly specific audiences with your own data. Or audiences that share characteristics with people in an existing list.

Here’s an example of adding location targeting on Google Ads:

If you aren’t sure who to focus your ads on, use One2Target to find out.

Open the tool, enter up to five competitors’ URLs, and click “Analyze.”

Once your results are ready, you’ll see detailed information on your competitors’ collective audience. 

For example, the “Socioeconomics” tab shows data points on your audience’s household size, income level, employment status, and education level. 

You can use this information to tailor your ad messaging, targeting, and offers to better match the needs and preferences of your audience.

5. Prepare Your Ad Creative

With your audience defined, it’s finally time to create your ad. 

Depending on your platform and type of campaign, you might need to do the following:

Write Ad Copy

Ad copy should capture attention and spark interest—especially if you’re running text ads that have no visual component. 

The exact style and format will vary based on your platform and campaign type. 

For instance, social media ads may be brief and punchy given they have images and videos that can do a lot of the talking. But search ads often require more detail.

And search ads are typically made up of three main elements:

• Display path: This is based on the page you’ll send people to after clicking your ad. You can modify how this looks to make it more approachable.
• Headline: This is the prominent blue text users typically see first, so make it attention-grabbing and relevant to the search query. Include your main keyword and focus on the value you offer.
• Description: This is the text under the headline that gives users more context about your product or service. Use this space to highlight unique features, address audience pain points, etc. And don’t forget to include a call to action (CTA). 

Here’s how it might look like to write your ad copy on Google Ads:

Optimize and Upload Images

For some campaigns (like for display and social media ads), you need images that represent your product or service well.

Then, use tools like Canva or Adobe Express to edit and resize images to meet platform requirements.

For example, Meta recommends images be at least 1,080 x 1,350 pixels for in-feed Facebook ads and at least 1,080 x 1,080 pixels for in-feed Instagram ads.

Google Ads recommends 1,200 x 628 pixels for banner images in display campaigns.

Whichever platform you’re using, add images to the platform’s ad creation section and preview how they’ll appear.

Here’s what that looks like within Google Ads:

Edit and Upload Your Videos

A well-edited video can capture attention quickly and communicate your message effectively in just a few seconds.

Use editing software like CapCut to trim footage, add captions, and ensure your video is high quality. 

Once you’re ready, upload your video to your platform of choice.

If you’re running YouTube video ads through Google Ads, you can do this during setup:

Don’t forget to read your platform’s guidelines on length, quality, and aspect ratio.

6. Review and Launch Your Campaign

The launch process will vary depending on the platform you’re using, but always make sure to give everything a final overview before you push your campaign live

For example, Google Ads includes a review stage that shows you an overview of the settings you’ve chosen and the ads you created. 

On the right-hand side, Google will also show you a “Campaign optimization score.” Which gives you an idea of how well-optimized your ads are. Like this:

Double-check everything, including your campaign settings, keywords (if your campaign uses them), audience, and budget. 

If everything’s in order, push your campaign live.

7. Manage and Refine Your Campaign

The key to a successful PPC campaign is ongoing management and optimization, so adjust as you gather more information.

Here are some tips to help you improve your PPC performance:

• Experiment with bidding strategies: Test different bidding strategies to get the highest return on investment for your ad spend
• Optimize ad copy: Regularly update your ad copy to keep it fresh and relevant. Test different headlines and descriptions to find what works best.
• Use ad scheduling: Some PPC platforms let you adjust bids (or stop bidding altogether) based on the time of day. This helps avoid wasting budget on clicks that aren’t converting. For example, you can turn off ads overnight.
• Refine targeting: Review audience insights on your ad platform to identify trends in demographics, behaviors, and engagement rates. Adjust your targeting to reach the most relevant users.
• Regularly track results: The exact monitoring frequency depends on your goals and campaign. But track key metrics at least once per week.

Once you have a good understanding of how your campaign is performing, you can start to make adjustments. 

Let's say you notice that the 18-24 age group engages with your ads more than the intended 25-34 group. 

In that case, you can shift your targeting to focus on younger audiences and adjust your messaging to better suit their interests.

Here’s what editing your targeting looks like in TikTok Ads:

Track Your PPC Campaign’s Performance

You now know the basics of running PPC ads, so you’re ready to start your first campaign. 

If you’re running search ads on Google, Semrush can help you gather the insights you need for more effective ads. From the best keywords to the most engaged audience and even your competitors’ strategies.

Sign up for a free Semrush trial to get started.

This post was updated in 2024. Excerpts from the original article by Marilyn Wilkinson may remain.