What is Pay-Per-Click Advertising?
by: Adrian Mullan
Adrian Mullan is the author of 'The Internet Demystified' and founder of WebDummy.com - a popular Internet marketing resource for small business owners.

Targeted traffic is the lifeblood of any website.

And while it is definitely worth optimizing your website for the search engines, you're likely to come across the following obstacles:

1) It takes time. It will typically take at least a couple of months before your website starts showing up in the search engines.

2) The top positions in any search engine can be very competitive. This means when your site does get listed, you'll usually start off lower down the list of search results.

This is where Pay-Per-Click (PPC) advertising can be a real life saver.

Pay-Per-Click advertising is the fastest way to start driving quality traffic to your website.

What is Pay-Per-Click Advertising?

A commonly asked question about the Internet is:

'How do Search Engines make money?'

The answer is simple - search engines make their money by selling advertising space to website owners.

This type of advertising is known as 'Pay-Per-Click' and it is a very effective and affordable form of promotion.

The concept of Pay-Per-Click (also known as 'pay-per-performance' or 'paid search') is based around the simple concept of matching buyers with sellers.

How does Pay-Per-Click Work?

When someone types in a keyword or keyword phrase into a search engine, they receive two kinds of results; Natural Results and Sponsored Results.

Search engine optimization focuses on improving your ranking in the natural results. Pay-Per-Click advertising focuses on the sponsored results area.

Natural Results (also know as 'Organic Results')

Natural results are free listings which are generated from the search engine's database. They are also sometimes referred to as 'organic results'.

The characteristics of natural results are:

- Listings are free. Website owners don't pay to be listed in the natural results.

- There are often millions of results for each topic, but most web surfers don't go past the first 30 results.

- With popular search terms the competition can be fiercely aggressive for the top positions.

- You have no control over the results - your position is determined by a search engine ranking formula (also known as an 'algorithm').

- You can, however, use legitimate Search engine optimization (SEO) techniques to give yourself a better chance of getting a good position (refer to search engine optimization).

Sponsored Results (also know as 'Paid Results')

The second type of result is Sponsored Results.

The characteristics of sponsored results are:

- Listings are paid for by advertisers.

- Listings appear at the top of the page and along the right hand side of the screen.

- Unlike natural search results, you get to specify your ad description and the keywords that make your ad appear.

Differences Between Sponsored and Natural Results

1. Fast set-up

Sponsored results can be set-up immediately, whereas natural results often take months to show a new site listing.

2. You have total control over your ads

You control the appearance of your ad, what position it appears in and how often it is displayed to web surfers.

Once you have your ad up and running, you are free to update it whenever your want. This differs from the natural search results where you have no control over your listing or its position.

3. You choose the keywords that your ad will appear for

Sponsored results allow you to specify exactly which keywords your ad will appear for. You can also specify which keywords you do not want your ad to appear for.

For example, if you sold Harley Davidson motorbikes then you'd want you ad to show up for searches related to 'Harleys' or 'Harley Bikes'.

At the same time, you wouldn't want your ad to show up for other searches that include the word 'bike' like 'mountain bikes' or 'racing bikes'.

4. You determine how much you are willing to spend

Pay-Per-Click advertising allows you to specify exactly what you're willing to spend on a daily basis. Generally, the higher you bid, the higher your ad will appear on the page.