Advantages and disadvantages of PPC

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Advantages and disadvantages of PPC

Advantages

The main benefits of paid search marketing are:

  • Advertiser is not paying for the ad to be displayed. Wastage is much lower with paid search compared to traditional advertising. Cost is only incurred when ad is clicked on and a visitor is directed to the advertiser’s website. Hence it’s a cost-per-click (CPC) model. However, there are increasingly options for paid search marketing using other techniques – Google also offers CPM (site targeting) and CPA (pay-per-action) options on its content network where contextual ads are displayed on third-party sites relevant to the content on the page.
  • PPC advertising is highly targeted. The relevant ad with a link to a destination web page is only displayed when the user of search engine types in specific phrase (or the ad appears on the content network, triggered by relevant content on a publisher’s page), so there is limited wastage compared to other media. Youtube users can also be targeted through Google ‘promoted video’ PPC option. Users responding to a particular keyphrase or reading related content have higher intent or interest and tend to be good-quality leads.
  • Full financial control. There is no minimum spend, you can set maximum monthly budgets on an account-wide basis or on individual campaigns, and you specify the maximum amount per click that you are prepared to pay for each ad.
  • Full editorial control. You are in complete control of every aspect of your campaign – from the title and ad copy, to the keywords and keyword matching option to apply, to the URL of the page you want users to send to.
  • Testing, tracking and tweaking on the fly. There are tools that allow you to run real-time comparison tests to see how differences in your ads affect your click-through rate, and a host of reporting options that let you track your campaign and tweak it to achieve better results.
  • Improve your reach. Target different keywords to those you rank for in the organic search, and broaden your reach for those more specific long-tail keywords that yield small volumes high-value traffic.
  • Transcend the boundaries of the SERPs. For even broader reach you get to select whether you want your ads to appear only on the search engine’s own sites, on their advertising affiliate sites, or even on specific affiliate sites of your choosing.
  • Good accountability. With the right tracking system, the ROI for individual keywords can be calculated.
  • Predictable. Traffic, rankings and results are generally stable and predictable in comparison to SEO.
  • Technically simpler than SEO. Position is based on combination of bid amount and quality score. Whereas SEO requires long-term, technically complex work on page optimisation, site re-structuring and link building.
  • Remarketing. Google offers retargeting through cookies placed on the searchers computer to display ads on the content network after someone has clicked on a paid search ad as a reminder to act. These can be effective in boosting the conversion rate to lead or sale.
  • Speed. PPC listings get posted quickly, usually in a few days (following editor review), SEO results can take weeks or months to be achieved. Moreover, when a website is revised for SEO, ranking will initially drop while the site is re-indexed by the search engines.
  • Branding. Tests have shown that there is a branding effect with PPC, even if users do not click on the ad. This can be used for the launch of products or major campaigns.

Disadvantages

There are surprisingly few if you manage your campaigns carefully and stay on top of your spending and conversion rates. The biggest one is that as bigger businesses continue to wake up to the potential of search marketing, and funnel more of their advertising spend online, the cost per click of more competitive keywords can soon get prohibitively expensive for smaller advertisers, but by getting clever with your use of long-tail keywords there are still plenty of opportunities to reap real rewards from PPC advertising.

The key thing to remember is that you have to pay for every click whether or not you convert – so it is important to keep track of the metrics and make sure you’re getting value from your investment.

Here is a summary of potential downsides:

  • Competitive and expensive. Since pay-per-click has become popular, some companies may get involved in bidding wars that drive bids up to an unacceptable level. Some phrases such as ‘life insurance’ can exceed 10 GBP per click.
  • Inappropriate. For companies with lower budget or narrower range of products on which to generate lifetime value, it might not be cost effective to compete.
  • Requires specialist knowledge. PPC requires a knowledge of configuration, bidding options and of the reporting facilities of different ad networks. Internal staff can be trained, but they will need to keep up-to-date with changes to the paid search services.
  • Time consuming. To manage a PPC account can require daily or even hourly checks on the bidding in order to stay competitive. This can amount a lot of time. The tools and best practice varies frequently, so keeping up to date is difficult.
  • Irrelevant. Sponsored listings are only part of the search engine marketing mix. Many search users do not click on these because they don’t trust advertisers, although these are mainly people involved in marketing.

Chaffey, D. and Ellis-Chadwick, F., 2012. Digital marketing: strategy, implementation and practice (Vol. 5). Harlow: Pearson.

Ryan, D., 2016. Understanding digital marketing: marketing strategies for engaging the digital generation. Kogan Page Publishers.

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