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Pay-Per-Click (PPC) Advertising

Also: PPC, paid search, search ads, SEM, search engine marketing, Google Ads, cost per click, CPC

Pay-per-click is advertising bought by the click rather than by the impression: an advertiser bids on the searches or placements it wants to appear for, and pays only when someone clicks the ad, with each click priced by an auction run at the moment the page loads.

Assessment. Paid search is the fastest way to establish whether there is demand for what a business sells, and an expensive way to serve that demand indefinitely. It can be started within a day and measured precisely; conversion tracking and a margin calculation belong in place from the first day, because the cost per click rises with every competitor who enters the auction.

The model inverts the economics of older advertising. A newspaper or a banner is paid for by exposure; a search ad costs nothing until a person chooses it. The advertiser picks keywords, the queries it wants to appear for, writes the ad, sets a bid and a daily budget, and points the ad at a landing page. Each time someone searches, the platform holds an auction among every advertiser whose keyword matches, orders the ads and charges the winners when they are clicked. The same mechanism prices ads on shopping results, on video and across display networks, which is why the Google Ads curriculum splits into Search, Display, video, shopping and measurement certifications.

The bid is only part of the auction. Google scores every keyword and ad pairing with a Quality Score from 1 to 10 built from three components, expected clickthrough rate, ad relevance and landing page experience, and the help page is explicit that the score itself is a diagnostic rather than an auction input: the same signals, estimated live for each search, decide where the ad shows and what the click costs. A relevant ad on a fast, matching landing page pays less per click than a poor one bidding the same amount. That is the lever a practitioner works: the account structure, the match between query and ad, and the page after the click, before the bid.

Quality Score componentWhat it measuresWhat moves it
Expected clickthrough rateHow likely the ad is to be clicked when shown for the keywordAd copy that matches the query; keywords grouped tightly
Ad relevanceHow closely the ad matches the intent behind the searchOne theme per ad group; the keyword in the headline
Landing page experienceHow useful and usable the page after the click isThe page answers the query, loads fast, works on a phone
  • Keywords and match types decide which searches trigger the ad; keyword research comes before the first bid.
  • Conversion tracking turns clicks into outcomes; without it the account optimises for traffic and the bill grows.
  • Negative keywords stop the ad showing for searches that cost clicks and never convert.
  • Bidding moves from manual cost per click to automated strategies once the account has enough conversions for the platform to learn from.

Paid search sits beside SEO on the same results page, and the two are run by different people with different clocks. The paid result appears when the budget starts and disappears when it stops; the organic result takes months to earn and continues afterwards. Most businesses run both, using the paid data on which queries convert to decide which pages are worth the organic effort. The paid search and display courses teach the account mechanics; the arithmetic of margin against cost per acquisition is what decides whether the channel is kept.

In practice

An accountant in Leeds bids on a dozen queries about limited-company tax returns with a small daily budget. Within a week the account shows which three queries produce enquiry forms and which nine produce clicks from students and job seekers. The nine become negatives, the three get their own ads and a landing page that names the fee, and the cost per enquiry drops by more than any bid change could have managed. The same report tells the accountant which pages to write for organic search.

Often confused with

SEO (Search Engine Optimization)
SEO earns a place in the unpaid results over months and keeps it; pay-per-click buys a place in the paid results immediately and loses it when the budget stops. They share the page and the query data and little else.
Keyword Research
Keyword research is the work of finding which queries matter and what they cost; pay-per-click is the channel that then bids on them. The research feeds both the paid and the organic side.

Key takeaways

  • →Paid by the click, priced by an auction at the moment of the search: fast to start, fast to stop, measured precisely.
  • →Relevance lowers the price. Expected clickthrough rate, ad relevance and landing page experience are the levers before the bid.
  • →Without conversion tracking the account optimises for clicks. Track the outcome first, then spend.

Related concepts

Where this concept sits in the field

Certifications that test this

Vendor exams whose syllabus covers this concept: facts, cost and a preparation path on each page.

FAQ

How much does a click cost?
Whatever the auction for that query settles at, which ranges from a few pence to tens of pounds depending on how much a customer is worth to the advertisers bidding. The platform's keyword planner shows a range before any money is spent; the account's own data replaces the estimate within weeks.
Is PPC the same as SEM?
Search engine marketing is the older umbrella term; in practice it now means paid search and is used interchangeably with PPC. SEO is the organic side and is not included.
Should a small business start with paid search or SEO?
Paid search, for the data. A month of a small budget shows which queries bring customers and what they cost, and that knowledge directs the slower organic work. Keeping paid search running long term is a margin question each business has to answer with its own numbers.

Sources

The primary text this definition rests on. Read it before relying on this one.

Last reviewed 3 October 2026 · Getting Digital