PPC for Beginners: What is PPC?

Written by neatly.io on 10th June 2016

So, you’re a budding entrepreneur, you’ve got your website freshly built, and you’re ready for some traffic!

You wait, but no-one’s showed up….

If this sounds like you, maybe you should consider PPC.

PPC (abbreviated from Pay Per Click), is a form of advertising on the internet. Essentially, it does what it says on the tin – you pay for each click that you get.

The most common version of this model is when your ad is put in the ad section of a search engine results page (SERP), and when a user clicks on it, you pay.

As we’ll cover throughout this post, there’s more to PPC than that. There are many factors that determine whether your ad is shown in the first place, but as a basic understanding, that’s PPC for you.

Pay Per Click advertising is a very powerful tool to have in your arsenal. When done well, it can help drive traffic and increase conversion at a very cost-effective return on investment.

At the risk of being a scaremonger, be wary that PPC can become expensive very quickly if done incorrectly. This is not a strategy that you can let run and run with little effort.

There are different providers that you can go with when trying to advertise using PPC, these are usually platforms made by, and for, the specific search engines.

An example of this is that Google has Google Adwords and Bing has BingAds, both of these tools are used for their own search engines to display ads.

PPC: How does it work?

So how does PPC actually work? To explain this in more detail we’ll be looking closely at the most common platform and campaign type: Google Adwords and search campaigns.

Firstly, you’ll choose some keywords (or search terms) that you want your advert to show on the SERP for.

Let’s say you’re selling plumbing supplies in Brooklyn. You’d choose keywords that are closely related to your business, so that you’ll show in the SERPs. Maybe you pick: ‘plumbing supplies brooklyn’ as one of your keywords.

You tell Google that you’re willing to pay up to £1.00 per click for your ad. This is your bid.

The next time someone searches for ‘plumbing supplies brooklyn’, Google will then break down the search query, and using related words for context and other aspects that are part of its vast algorithm, holds an auction between all the advertisers who have bid on this keyword to decide which ad to show.

example ad for plumbing supplies

In this auction, Google pulls out all the keywords from everyone’s adword accounts that are relevant and it deems worthy.

Google ultimately decides who wins, not by who is willing to pay more, but by using something called Ad Rank.

This is Google’s formula for deciding what makes a good ad. It’s calculated simply by the Max CPC (Cost Per Click), multiplied by the quality score of your Ad.

How Google Works Out Your Ad Rank

The Quality Score is a formula created by Google to determine the relevance of your ad. It looks at the relevance of the ad and landing page, as well as the user experience of your landing page.

The quality score is very important as it shows if your ads are good, bad, or if they need work. Not only this, but when Google is calculating how much you pay, having a good quality score for your ads and keywords can lead to you getting a higher ranking for a lower price.

Now, you’re probably wondering how Google decides how much you pay. Well, Google make you pay the minimum amount you can to get the best rank. The way it decides how much that is, is by taking the Ad Rank of the person below you in the auction and dividing it by your quality score, and then adding $0.01.

Other PPC Advertising Networks

So we’ve briefly covered that there are other PPC Advertising networks, but we’ve really only went into further detail with Google. Google is by far one of the most popular search engines and ad networks, owning 71% of the market currently.

Bing is the second biggest, possessing 12% of the market share. Bing ads can be a very useful network because of the fact that many people ignore it. What I mean is, Bing has less advertisers on its networks, which means less competition, which in turn means it can be less costly.

While Bing might have less share, there are obviously still people using it – don’t miss out on them.

Bing has its own advantages, especially today as Google continues to rise in price. Another popular PPC network is Facebook. Social media is growing, and along with it the marketing potential.

Facebook and social media PPC marketing are reportedly a lot lighter on the wallet than Google, with Facebook also offering a much better targeting system than Google. Using Facebook allows you to pick who sees the ad, ranging from their age, gender and even their interests.

The thing to keep in mind is that Google is not the only PPC advertising platform. When deciding which platforms to advertise on, you should take into account your goals and what resources you’re able to dedicate to them.

Other Types of PPC Advertising Campaigns

So, throughout this post we’ve discussed campaigns, and briefly talked about the different aspects involved in search campaigns. Before we go any further, it’s essential you understand Google’s advertising networks

There are two different networks that Google Ads are displayed on. The first network is called the Google Search Network, which is the search results pages from Google where all of the Search ads can be found.

The next network is called the Google Display Network. This is where all of the display ads can be found, seems obvious huh?

The display network displays on different websites that have partnered with Google and have immense reach. These sites include those using Google Adsense, which allows publishers to allow advertisers to place ads on their site.

So now that we’ve briefly discussed the different ad network, we can go over the different types of ads there actually are.


As we’ve discussed, Search Campaigns are campaigns Google displays on the search network. These campaigns only include ad text and can have various different ad extensions implemented to increase the Click Through Rate (CTR).


Display Campaigns are used by Google to show Ads on different websites. The display campaigns are usually just an image with strong call to action. These can be used if you’re looking to target a specific customer, as they can target websites related to their product or service, or those who have previously visited your site.

Search With Display

Search With Display campaign type can show up in both the Google Search results as just text, or on Google partners websites as a display ad, as long as the keywords are relevant.

Managing the search with display campaign is very similar to that of the search campaign.


Shopping campaigns are eCommerce focused and allow retailers to promote their products within the search results. It requires setting up a Merchant Center account but provide great results for eCommerce stores.


Video Campaign are displayed on Youtube, they’re either overlaid over the video (displaying products/services to buy), pre-video or they’re displayed on the recommended tab for people who Google thinks will be interested in purchasing your product. These were previously managed in YouTube itself, but have recently been added to Adwords.

How To Setup a PPC Campaign

By now you should have a fair understanding of what PPC is, but how do you set up a campaign? In this section we’ll talk about the terms used in most PPC, and how to set up a campaign on Google Adwords.

Processes like these can, and do vary on networks, and some are more straightforward than others; however I find Google to be a decent middle ground.

Before we go through the actual process of setting up a PPC campaign, we’ll go over the different aspects of a campaign.

There are three aspects to a normal search campaign; the campaign> the ad group(s)> Keyword(s). Below is a quick summary of what each of these mean:

  • Campaigns

Campaigns are the top layer of the pie. They can be organised and structured how you choose, most tend to segment based on product types, or categories within your website. Campaigns are also where you set the budgets, so ensure you’ve split your campaigns in a way in which you can also split your budget appropriately.

Back to the Plumbing Supplies example – your first campaign might be around supplies for Bathrooms, so you could call your first campaign Bathroom Supplies.

  •        Ad Groups

Ad Groups are the middle layer that contains your keywords. These are essential to structure correctly. Make sure that all of the keywords within the ad group relate to the same ads.

In our Bathroom Supplies campaign, we might create two ad groups: Toilets and Basins.

  •       Keywords

Keywords are the core of the search campaign; they’re the final layer and, essentially the one thing that needs the most amount of research.

To find keywords for your campaign, you can use Google’s Keyword Planner tool.

In our Toilets ad group you could add the keyword ‘toilet seats’ and ‘toilet cisterns’.

Now that we’ve gone through this, it should be a lot easier to understand the process of creating a campaign.

When you log into Adwords / create an account, you’ll be greeted with a “Create Campaign” button. After that you’ll be sent to this page:

Setting Up Your First PPC Campaign Step 1

Here you can name your campaign and select which features you would like. Using Advanced Features is recommended. As the name suggests, it gives you access to all features, including all ad extensions.

After scrolling down and filling in your basic information like location and language you’ll get to select the bid strategy, bid and budget.

Setting Up Your First PPC Campaign Step 2

If you want to maintain control, Manual CPC is the best strategy, if you’re looking to get as many clicks and impressions as possible you can also try using automated CPC. If you’re just starting out we recommend you choose manual cpc.

Underneath you’ll see some ad extensions that you can add to your campaign, these can be very useful and increase number of clicks on an Ad.

Once you click save and continue you’ll be prompted to the following:

Setting Up Your First PPC Campaign Step 3

This is where you name your Ad group and add in the Keywords you want associated with that Adgroup, you also have the option to set the bid.

This bid will become the default Max Cost per Click for all keywords in this adgroup. You can however edit individual keywords’ bids later.

On the top of the page you’ll see a enter “landing page” text bar, you can use this to help find keywords for you ad group. Google crawls your page and chooses keywords that it thinks are appropriate.

Next, it’s time to create your ads. Make sure to include a strong call to action and to make it relevant to the keyword you’re bidding on. Remember there are character limits:

  • Display URL: 25
  • Description Line 1: 35
  • Description Line 2: 35
  • Headline: 25

It’s worth noting that Google recently announced changes that they will making to Adwords later this year, including expanded text ads with:

  • Two 30 – Character headlines
  • One 80 Character description line
  • Automated domain extraction from your URL

So while you need to create ads based on the current character limits, it’s worth keeping in mind how you’ll adapt them when the changes are implemented.

So there you have it – that’s pretty much the basics of PPC and Google Adwords. By now you should now know what PPC is, what keywords are and how they work, the process of keyword bidding and auctions, and how to set up a campaign.