Pay per click, or PPC, is a very effective form of internet marketing, enabling your site to be listed on the first page of the search engine and getting you found by your customers. Working together with a good PPC management company will enable you to get an excellent rating through organic searches. However, PPC is expensive and only if it is managed properly will you be able to see a return on investment.

How PPC Drives Traffic

If used appropriately, it doesn’t cost you anything and enables you to run at a profit. However, if not used properly, it will cost you dearly. Essentially, you pay for clicks on advertisements that lead people to your website. How much you pay for each click depends on your personal bid. If you do things properly, then everyone who clicks also makes a purchase, which means your investment is returned.

Managing this process starts even before you start to bid on keywords. You need to create a functional PPC management strategy. This will help you to determine what your spending budget it. While, once your campaign is up and running successfully, you can set this to monthly, it is recommended to start with shorter time periods, even as short as a day. Once you reach your budget, no more ads will appear with your link in it, which means you cannot overspend. However, your goal is not just to not overspend, it is to earn your money back.

To be able to do this, you need to work out what the value of the average customer is who comes to your website. This will give you a better idea of how much you can bid on a keyword. PPC is a form of advertising, and advertising is about spending money to make money, but reasonably so. You must know that you earn the money you pay for each click is returned to you, in other words. Calculating the value of a customers is done by a mathematical formula:

{average monthly number of unique visits} / {average sales per month} = conversion rate

{average gross revenue} – {average expenses} = costs

{costs} / {average sales per month} = net profit for each sale

{net profit for each sale} / {conversion rate} = value of unique visitor

To run a profitable PPC campaign, you need to make sure that each bid is no more than the value of each visitor, preferably less so that you run a profit.

PPC management is not only about setting it up, it is an ongoing process. You need to review he various analytic reports to see whether your keyword bids are effective, and if they send traffic to your site. You also regularly need to test new keyword phrases and keywords to see whether you can improve.

PPC management is quite complex, although you can generally get the hang of it quite quickly. It is also highly time consuming, however. Put together, those are reasons as to why you should hire a professional management company to do it right.