The Complete Guide to Successful SEM Pay-Per-Click Advertising

My website is new, and it will take some time for organic (SEO) traffic to build up. Is there a way to get more online traffic right away? The answer is yes. If you are not getting the visitors you need through SEO or traditional marketing methods, PPC campaigns can put your business in front of ready to buy customers instantly.

What are PPC and CPC?

Contextual wise, what is the difference between PPC and CPC?

  • PPC, or Pay-Per-Click, is one of the most popular methods of SEM (Search Engine Marketing) advertising. It works by advertisers paying a certain amount of money every time a visitor clicks on their advertisement. These paid advertisements are generated through platforms like Google AdWords and Bing Ads.
  • CPC, or Cost-Per-Click, indicates the actual dollar amount that the advertiser needs to spend for a single click on the advertisement per keyword.




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How PPC Works?

One example of a paid search would be the links with the green “Ad” logo on Google SERP (Search Engine Results Page). In Google, the ads usually appear on the first page of search results right above the organic search listings.

These are ad positions you bid for in an ad auction within Google AdWords. You name the price you want to pay for a single click. If your price is the highest, the ad will rank number one in position.

PPC Keyword Research

Within AdWords, every keyword will be assigned a Google recommended value of CPC in order to rank on the first page of a SERP. Depending on your industry, CPC can get very expensive. In certain cases, first page CPC can cost well over $10 in a single click. Those clicks can quickly add up and exhaust your marketing budget.

However, there are less costly keywords that are just as effective. Receiving clicks are great, but converting them into revenue is the ultimate goal of SEM marketing. If you choose the right targeted keywords with high conversion, you can discover your own unique niche market that will not cost an arm and a leg to bid for.

PPC keyword tools can help you identify the money-words with the lowest cost per acquisition and highest conversion rate. For example, discovering long tail keywords (which are phrases with 3 or more words) tend to cost much less in CPC rates and will help lower your cost per acquisition. At the same time, customers who use long tail keywords to search online tend to know what they are looking for and are more likely ready-to-buy customers.

Here is a list of keyword research tools that tops our chart. Learn to do PPC keyword research from our comprehensive PPC keyword research guide.

SEM Tools


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  • Research complete list of keywords with current SERP results and display
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  • Discover shared keywords that your competitors are bidding for

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The PPC Campaign Calculations

In order to determine the success of a PPC campaign, it is important to understand the following three components of online marketing calculations:

Calculation #1: Click-Through-Rate

The CTR or Click-Through-Rate metric helps determine whether an ad can generate a good engagement. The higher the CTR, the better your ad performance will be.

Click-Through-Rate is calculated by the number of clicks divided by the number of impressions. Multiply the value by 100 and you will get a click through rate percentage. A good click through rate percentage for an ad is normally around 1%, however, depending on your industry the CTR may go higher or lower.

sem pay per click advertising click through rate calculation

Calculation #2: Conversion Rate

Conversion rate is the metric you need to closely monitor because it determines the advertisement’s profitability. Conversion in a PPC campaign is the number of leads or sales gained through clicks of advertisement. Conversion rate is calculated by the number of conversions divided by the number of clicks. Multiply this value by 100 and you will get a conversion rate percentage. Depending on your business, average conversion rate varies by industry.

sem pay per click advertising conversion rate calculation

Calculation #3: Cost Per Conversion

Cost per conversion determines the cost per acquisition for a PPC campaign. It tells you if the marketing dollar spent on a campaign is worth the price base on your business needs.

Cost per conversion is calculated by the total campaign cost divide by the total conversions. The value is a dollar amount which represents how much an ad campaign cost to make conversion happen.

sem pay per click advertising cost per conversion calculation

3 Reasons Why PPC Marketing can Fast-Track Your Business Online

With proper research and setup, PPC campaigns can achieve immediate results within a planned budget. Here is what you can expect:

1. Instant Traffic

Unlike SEO marketing, which takes some time to see results, PPC can deliver instant traffic by displaying your ads on top positions of search queries within Google or Bing. Include high search volume keywords in ad message. It helps you gain visibility and improves conversion opportunities.

2. Controlled Cost

You decide how much you want to pay for each keyword click, so the cost is completely transparent. However, it does not mean advertising campaigns won’t get expensive.

Let’s go back to our PPC calculations for a minute. Even if you pay $0.50 per click, with 10,000 clicks, you will end up with a $5,000 dollar bill.

On the other hand, if 40% of those clicks converted into a sale with a $10 profit, then you are looking at a $40,000 earning. That is marketing money well spent.

So ultimately, your cost control and management are more than just receiving clicks. With the right SEM tools, you can improve and accelerate the campaign to convert more traffic into revenues.

3. Targeted Customer Marketing

Unlike traditional marketing where you are targeting as many people as possible and hoping some of them will become your customers, PPC is a much more defined marketing method.

It targets audiences who have already shown a preliminary interest in what you have to offer. PPC allows you to market to specific niche audience who fits your demographic criteria, so your ad targeting is more precise and effective. For example, use ad scheduling and geolocation settings to customize audience reach of every campaign.

Focus on Conversion

Sometimes PPC marketing can be a love-hate relationship. The best advice is to concentrate your effort on the conversion and don’t become fixated on the clicks. Make sure you are comfortable with the budget you set. Keep refining your campaign until you have found the winning strategies.

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