A deeper look into PPC advertising
PPC is often known as search engine marketing, IMO the most powerful web marketing tool. In one of my previous posts I presented some figures related the advantages of paid search. I’ve noticed there are lots of users seeing PPC as being somewhat isolated of SEO, which am going to point out it’s not true at all. Actually, successful PPC campaigns are tightly related to SEO, especially on Adwords, where the variable Quality Score comes in place.
I want you to understand that the presentations on this blog are not merely theory, but insights given by practice on the most complex PPC campaigns and SEO you can imagine. The author has a deep knowledge of web marketing theory and his prospective doesn’t aim to simply throw some words on a blog – as you can find a lot on the web – but to share some important facts with you.
Why PPC depends a lot on SEO? First of all, for 2 simple reasons: (1) the quality score (QS) is related to (a) ads’ relevancy plus (b) landing’s page quality and (2) QS is the most important factors influencing your campaigns’ cost.
BID RANKING determines the position of your ad on the page (AD RANKING) and is calculated from Max CPC x QS. Please keep in mind that a high quality score may determine an ad to have priority against a higher ranking ad, if the ad ranking is a result of higher max CPC and lower QS. You may better understand this if you look closer to the formula:
Actual CPC = (ad rank to beat / QS) + $0.01
Let’s assume that you are on the fist position with ad rank = 20 and QS = 5 (this means max bid = $4.00) and the second position has an ad rank = 12 and QS = 6 (hence max bid = $2.00), you have to pay ( 12/5 ) + 0.01 = $2.41 (CPC). But you may have the same ad rank with a higher QS, for instance:
Ad rank = 20, QS = 10, therefore max bid is $2.00, but in this case your actual CPC would be:
(12/10) + 0.01 = $1.21 !!! which is basically half of the money for the same first position!!! You can easily imagine how this does reflect on your budget: you cut to half your advertising cost!
Conclusion
This is a brief example pointing out the tight relation between PPC campaigns and SEO. All 3 main factors determining the QS are related to SEO: CTR (apparently not that close), ad relevancy (which is connected to landing page content) and landing page quality (how your landing page is organized).
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