Does PPC Work? Here’s How to Tell If It’s Right for You

You might have heard that businesses make an average of $2 for every $1 spent with pay-per-click (PPC) advertising. Perhaps you heard that PPC ads can catapult you to the top of search engine results pages (SERPs) and that 41% of all clicks for commercial search queries go to the top three paid ads. But does PPC work? Is PPC worth your time and effort? Yes, the rumors are true. PPC can significantly increase your visibility online, boost your sales, and provide an impressive return on investment (ROI). In this post, we’ll take a closer look at:

• What PPC advertising is
• How PPC works
• The importance of PPC
• When it’s best to use PPC ads

If you’d like to explore PPC further, check out our other free PPC resources.

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What is PPC?

PPC is an online advertising model in which you pay per click, rather than per impression or for a certain amount of time. PPC ads come in the form of display ads on websites, ads on social media sites, and, most commonly, paid ads on SERPs. When someone clicks on your PPC ad, they’re taken to a landing page on your website. Here’s what PPC ads look like on a Google SERP:

How does PPC work?

Since they’re the most common kind of PPC ad, we’ll look at ads in Google search results for an example of how PPC works. Whenever someone completes a search on Google, the platform checks to see if advertisers bid on the keyword the user searched. For example, a company that sells socks online might bid on keywords like “buy socks online” and “fun socks.” If advertisers bid on the keyword, Google will choose several ads to show through an automated auction process that takes only milliseconds to complete. The auction process considers several factors. The system multiplies each advertiser’s maximum bid by their quality score to get their ad rank. Google then displays the ads according to who has the highest ad rank.

• bid x quality score = ad rank

To determine an ad’s quality score, Google considers its expected click-through rate (CTR), relevance to the user query, and the quality of the ad’s landing page. With the quality score metric, Google aims to determine how useful an ad will be to the user. Google uses another formula to determine how much you pay for each click. This formula is:

• the ad rank of the ad below yours / your quality score + $0.01 = your cost per click (CPC)

If you have a higher quality score, you’ll pay less. As a result, improving your quality score will help you deliver more relevant ad content and improve your ROI.

Does PPC work?

So, is PPC effective? Yes! PPC is an effective digital marketing method if you have the right strategies in place and have high-quality ads and landing pages. PPC works especially well when you want fast results or you want to target highly specific audiences, especially those toward the bottom of the marketing funnel. How effective is PPC? These statistics will give you an idea:

• Companies spent $164.6 billion on search advertising globally in 2022. This amount is projected to grow to about 190.5 billion U.S. dollars by the end of 2024.
• PPC ads in search results account for 45% of page clicks.
• Nearly 75% of people say ads make it easier to find what they’re looking for.
• Visitors that arrive at your site via a PPC ad are 50% more likely to make a purchase than organic visitors.
• Search PPC ads can increase brand awareness by as much as 80%.

The advantages of PPC

What are the main advantages of PPC that make it so effective?

• Cost-effectiveness: With PPC, you only pay when someone clicks on your ad, providing a chance for a new lead or conversion. You can also set your maximum spend so that you stay within your budget. As mentioned earlier, PPC also provides a great ROI!
• Quick results: Digital marketing methods like search engine optimization (SEO) take longer to produce results, but with PPC, you can launch a campaign and track results immediately.
• Increased visibility: PPC search ads sit above the top organic search results, so winning those ad spots gives your brand lots of visibility.
• Targeting: PPC platforms offer highly detailed targeting options. You can target by keyword and target users based on characteristics such as demographics, interests, and past online activity. You can even target users who recently visited your website.
• Detailed reporting: With PPC advertising, you get detailed data about your campaigns, which you can use to adjust your current campaigns and plan future ones.

When is PPC most effective?

You have lots of options when it comes to Internet marketing channels, from SEO to social media to PPC. The best digital marketing strategies use a mix of channels, but it’s helpful to know what each channel is best used for. So, when does PPC work best?

1. When you want quick results

You need to build up your website’s authority over the long term with strategies like SEO, but there are also times when you need results fast. With PPC, you get your ads in front of users as soon as you launch your campaign, so it’s excellent for getting results quickly. For example, you might use PPC to promote a sale, limited-time offer, product launch, or other time-sensitive event.

2. When you want precise targeting

With PPC, you can target your ads to precise audiences. You can target users based on a wide range of characteristics, ranging from their age to hobbies to marital status. If you know who you want to reach and want to target them directly, PPC is an excellent method to use.

3. When you want to reach bottom-of-the-funnel leads

PPC is ideal for reaching users who are close to making a purchase decision. Users who are still gathering information might be more likely to click on an organic result, but those who are ready to buy are more likely to click on an ad if it fits what they’re seeking. In fact, 65% of high-intent searches — those in which the searcher is strongly considering making a purchase — result in an ad click. This data highlights the importance of PPC for digital marketing strategies.

4. When your product, service, or website might not show up in organic search results

If you just created a new website and don’t yet have many pages, or you have a minimal number of pages, you probably won’t rank in organic search results immediately. You’ll have to create content and build up your site authority before you can rank. You might not want to wait for that to happen to establish a presence on SERPs, though. PPC is ideal in this situation, since it gets you to the top of the SERPs, even if your site is lacking in certain areas. Your PPC ads can bring traffic to your site while you work on your SEO. You might also want to use PPC if there’s not a high search volume for your product or service. Perhaps, for example, your product is totally new and unique, and not many people have heard of it yet. Say, for instance, you invented a new technology. Before virtual reality headsets became well-known, people weren’t searching “virtual reality headsets” on Google. If you were one of the first VR headset companies, you might create PPC ads and bid on keywords related to video games or new technologies to reach potential customers.

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Learn more about how PPC can work for your business

So, is PPC effective? It sure is! You just need to make sure you have the right strategies, ads, and landing pages set up. At WebFX, we’ve managed more than 650 client PPC campaigns, so we know this strategy inside and out. We offer PPC consulting services to help you understand how to improve your campaigns. We can also do the work for you, creating a PPC strategy with ads and landing pages that help you meet your goals.

Want more digital marketing tips from the WebFX team? Join more than 200,000 marketers in signing up for one of our email newsletters. If you’d like to learn more about our PPC management services or other digital marketing services, request a free quote today!