Internet advertising deploys various models for its functioning and Pay Per click advertising is one of these models. In Pay Per Click advertising model the advertisers pay their hosts only when the advertisement posted on their site is clicked by the target consumer.
When it comes to search engines, the pay per click advertisers place a bid on the keyword phrases that are most relevant to the target group of consumers. The content sites on the other hand charge a fixed price per click rather than adopting a bid system for their ad placements.
Cost per click is the amount or the price an advertiser has to pay to the search engine provider and the publisher of websites where his ad appears every time a consumer clicks on the advertisement. Cost Per Click is determined using either of the two systems: Flat Rate and Bid Based. Under Flat rate Pay Per Click [PPC Services], the cost is fixed for every click.
This cost is determined by an agreement between the advertiser and the publisher and the method is mostly used by shopping comparison websites which often publish rate cards of various shopping websites.
The bid system placing bids and contesting auctions for a given ad space on a website. The advertiser, in order to bid for the ad spaces on a particular website have to first sign a contract with the publishers and then lodge the highest amount. It’s a complex automated process and the advertisers pay for the each click they receive.
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