Skip to main content

Pay Per Click: Defined

Mar 15, 2015

What is it?
PPC stands for “Pay Per Click,” an Internet advertising model used to direct traffic to your Web site, where an advertiser pays the publisher when the ad is clicked. PPC can be an effective way to supplement your inbound marketing efforts, and are currently quite popular. Examples of PPC include Google Ad words and Facebook advertising. You can set your PPC budget by day, week or month so you never need to worry about overspending on these campaigns or losing track of your budget.

PPC has an advantage over pay per impression, in that it tells us something about how effective the advertisement was. Clicks are a way to measure the attention that your ad is receiving as well as any interest. To utilize PPC correctly, increase your conversions and click-through rate with the right ad copy. Some PPC ads only allow for copy, while others, like Facebook ads, include room for an image. It might be helpful for you to run some A/B testing with two separate ads, to see what receives a higher click through rate. You can then move forward with the ad that appears to be receiving more attention, which is the end goal. If no one clicks on your ad, then you are wasting time and need to reevaluate your approach.

Successful click-through rates
Now what is a click-through rate (CTR)? CTR is a way of measuring the success of an online advertisement and is typically interpreted in percentages. The click-through rate is the number of times a click is made on the advertisement divided by the total impressions. Impressions are defined as the number of times the advertisement was served or presented. For example, if an online ad is served 200 times (200 impressions) and receives two clicks, then the click-through rate for the advertisement would be two percent.

You might wonder what a good CTR is these days. As Internet surfers become more numb to an ad’s location, CTRs for ads have started to fall. Banner ads are shown across the top of Web sites, or down by the footer, or on the right hand side and since these locations haven't changed, surfers now spend less and less time focused on these areas as they navigate from one site to another. Their eyes only focus on the content areas. CTRs are currently averaging closer to 0.2 or 0.3 percent. 

Grabbing their attention
I would suggest using an animated GIF format for your online ads. Adobe Photoshop will allow you to create an animated GIF with multiple frames. We are starting to see more and more of this because it grabs the surfer’s attention. The ad is no longer a still frame, as it changes and can repeat indefinitely. You might also want to consider using colors that pulls their eyes away from the content towards your ad. Animated GIFs might only be suitable for certain PPC advertising platforms and might see them being used in banner ads on Web sites. In the end, it all goes back to trial and error. You need to find out over time what works best for your target audience.

Before you go live with PPC advertising, you need to decide where you are going to direct the traffic. Where will it take them once they've clicked on the ad? Most ads will direct you to their site. I don't always think that this is the best decision. If someone clicks through to your Web site, but quickly becomes disinterested, then you've lost them and they will venture off elsewhere. It's important to direct the ad to a landing page that makes sense. I am a big fan of driving traffic back to our social media sites through our PPC ads. I think this is the way to go because it is less pushy. They may not be ready to reach out to you today or make that buying decision right now, but if your ad directs them to your Facebook page, for example, there is less pressure. They may look to see what type of content your posting, whether your company has received positive reviews and hopefully, if all goes according to plan, they will “Like” your page. This is the goal. We post on a daily basis on all of our social media sites, so if they decide to “Like” us on Facebook, “Follow” us on Twitter or anywhere else that gives us an opportunity to show up in their News Feed every day, then we have successfully remained in front of the customer. This is much more valuable than just dropping them on the homepage of your Web site.

Tracking your results
The number one reason that most businesses fail at PPC advertising is they don’t log in enough. You have to commit to regularly logging in to review your account and its performance, as it won’t manage itself. This is also a great opportunity for you to learn about what’s working and to pull some analytics or data from the campaign.

As a beginner that is interested in getting started with PPC, I would suggest starting with Facebook. Over one billion people use Facebook to connect. Ads on Facebook can be strategically targeted based on a user’s age, location, relationship status and more. However, be mindful of being strategic with the ad copy as with all PPC advertising, there is typically a character limit. Make sure that you include a call-to-action giving them a reason to click on your ad. PPC can be an integral part of your online marketing strategy when done correctly.


Ryan Kelly is marketing manager with Norcom Mortgage & Insurance. He may be reached by phone at (860) 899-2734 or e-mail [email protected].

This article originally appeared in the February 2014 print edition of National Mortgage Professional Magazine. 

About the author
Mar 15, 2015
The Rise Of Mortgage Influencers

Social selling, the new frontier

Apr 11, 2024
Mortgage Influencers

Three Common Mistakes

Apr 11, 2024
Trimming The Fat

Direct Wholesale Rates is a passion project aimed at cutting the retail margin

Mar 28, 2024
Get The Gig With Gig Workers

Your borrowers might be among 39% of American workforce that freelances

Mar 27, 2024
When Life Hits You Like A Truck, Make Opportunity Fit Your Needs

Think outside the box and visualize all the possible ways to achieve things

Mar 27, 2024
The Difference Between Competing And Closing

Master Non-QM/Non-Agency business purpose lending

Mar 27, 2024