Saturday, January 17, 2009

71. CPC-Based Web Advertising


One of the most popular methods of online advertising is CPC, or cost-per-click, advertising. If you have been researching online advertising, you are probably already familiar with this term. As Web users become more and more jaded to banner and button ads, and click-through rates for these types of ads plummet, CPC advertising has taken hold. Ads are displayed in the same way as in CPM (cost per 1,000 impressions, or instances of an ad appearing on a Web site) deals the difference is in how the customer pays for the advertising.

In a CPM campaign, you pay for each how many times the ad appears. If your ad performs well and lots of users click through to your site, then each click-through costs you less. On the other hand, the lower the click-through rate, the more each click costs you. CPC advertising protects you by fixing the amount you pay for each click, and sets a ceiling on how much you'll pay. By paying only for actual clicks, you save money and reach only targeted customers.

Gone are the days of paying for thousands of impressions that are uselessly displayed. This is a great way for businesses to control their advertising budget and gauge response to their advertising campaigns. For example, if you decide to advertise with a CPC-based search engine or a featured listing with a search engine, your ad will display each time a user enters in a keyword that matches your predetermined keyword list. You don't pay each time the ad displays; only when it's actually clicked.

If you prefer to try CPC-based banner advertising, the principle is the same. Your ad will display and each time it is clicked on by an end user, you get charged. Your ad runs until you have reached a predetermined amount of actual clicks. This means that your ad may get much more exposure than it would using a traditional impressions calculation method. These extra impressions allow your ad to stay up longer, which may mean that even if you do not receive click-throughs right away, you may end up with users who decide to visit your site later on.

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