Pay-per-Click Advertising for Small Business

Making a pay-per-click (PPC) ad is not easy, but it can be one of the best methods for small businesses to advertise their products and/or services. 

Creating a solid PPC advertising strategy is all about understanding your own business and marketing goals and then taking the time to match your business’s requirements with the most suitable types of PPC ads. 

In this guide, we take a look at what pay-per-click advertising is, how it works, and how you can use it for your small business.


What Is PPC Advertising?

Pay-per-click (PPC) is a form of digital advertising that allows businesses to market their products and/or services on popular search engines, websites, and social media platforms. 

With PPC, businesses are only charged when a user actually clicks on their ad, rather than when they place the ad itself. This means that PPC advertising can be great for small businesses with relatively small budgets. 

Pay-per-click ads can typically be found at the top of a person’s search results — whether as a product result or as a content result. As you will see below, there are several kinds of PPC ads. 

A great aspect of PPC advertising is that it allows business owners to stay relevant. This is the case for the following two reasons:

  1. PPC advertising can be very targeted. PPC ads can be shown at specific points during the day, at certain locations, to specific demographics, or even to specific devices. 
  2. PPC advertising is very trackable. In fact, business owners and advertisers can choose to exclude keywords, phrases, websites, and even specific users (e.g., remarketing, etc.) in order to increase the efficacy of their PPC ads. 

Different Types of PPC Ads

Search Ads

Search ads are the most common types of pay-per-click ads.

In a search ad, you can choose the keyword or phrase that you want your ads to show on. PPC search ads follow an auction or “bidding” system in order to decide which business — or advertiser — will appear on top of a search engine’s results page. 

Contrary to popular belief, this is not based exclusively on the amount bid but on a variety of qualifying factors that take into account your ad’s relevance to the product and/or keyword search. This is known as a business’s Quality Score

Display Ads

Unlike search ads — which only show to users who search specific keywords — display ads are “displayed” to individuals who are browsing the internet based on whether they are likely to be generally interested in such a product or service.

This means that display ads inevitably tend to generate a lower number of conversions in comparison to search ads but can be better for increasing awareness among customers for a particular brand. 

Display ads are also relatively cheaper per click in comparison to search advertising. 

Remarketing Ads

A remarketing ad is only shown to users who have already visited a business’s website. 

This is generally used to differentiate between the users who have already visited your website and were not interested in making a purchase and the users who almost did make a purchase (e.g., adding items to a checkout basket, etc.). 

For example, you can direct a remarketing ad towards the following types of audiences:

  • Previously purchased from your website
  • Signed up for your business newsletter 
  • Signed up for your SMS marketing 
  • Added items to your website’s checkout basket
  • Spent a significant amount of time on your website (the actual amount is entirely up to the discretion of the advertiser or business in question)

By excluding previous traffic that was not “qualified,” remarketing ads can be used to generate more conversions, increase sales, and generate more revenue. 

Social Media Ads

Social media PPC adverts are ads that users can see and click on within a social media platform.

Most popular social media platforms allow users to include PPC advertisements, including:

  • Facebook
  • Instagram
  • Twitter
  • LinkedIn
  • Snapchat
  • Quora

For more information, see our guide on social media marketing.

Shopping Ads

Shopping ads are similar to search ads in that they are also shown on search engine result pages. Unlike search ads, however, they include the following information: 

  • An image of the advertised product
  • The price of the advertised product
  • The title and description of the advertised product

As such, shopping ads are ideal for businesses that specialize in products rather than services. 

Shopping ads can provide businesses with one of the highest ROI compared to all other PPC types. This is because users who click on them already know significant information about the product in question (e.g., the price, how it looks, etc.), and so they will be unlikely to be deterred post-click. 

In-Stream Ads

The benefit of including advertised video ads — in comparison to organic video content — is that your videos will be shown to a high number of users who are not already aware of your brand. 

This can benefit you in the following ways:

  • Increased brand recognition
  • Increased social media following
  • Increased conversions 

Since PPC video ads can be included on a high-traffic platform like YouTube through Google Ads, setting them up is also a relatively easy process if you are already relying on other types of PPC advertisements.

Gmail Sponsored Ads

Gmail Sponsored ads can be created within Google Ads and allow businesses to advertise their products and/or services on Gmail. 

These types of PPC ads look very similar to traditional emails. Once they are clicked, they are taken to an “expanded” version of the ad, which offers readers the opportunity to click a link and be directed to a business’s website. 

Amazon Advertising

Amazon offers its sellers a PPC model that they can use to market their products to specific demographics. 

At the moment, there are three types of PPC ads that you can choose from on Amazon’s advertising platform. These include:

  • Sponsored Product Ads: These show your ad on Amazon’s search results according to the relevant keywords that were searched.
  • Headline Search Ads: These show your ad on the top of Amazon’s page. 
  • Product Display Ads: Product display ads are fairly similar to shopping ads (e.g., include images, etc.). 

If you are selling both on your website and on Amazon, make sure that the money you invest in your Amazon PPC campaign is not directly reducing the number of sales on your actual website.

How Does PPC Advertising Work?

In order to create a PPC ad, you will need to create a campaign with your preferred keyword theme. This is the phrase that will relate directly to your product, service, or actual business — depending on what you are advertising. 

For example, you can create a campaign with the theme “QR code generator.” Within your campaign, you will be able to find your ad groups, which will include related subheadings, such as:

  • Static QR code generator
  • Dynamic QR code generator
  • Free QR code generator 

Each Ad Group will contain several keyword variations (e.g., Free QR code generator, QR code generator for free, etc.). All of the used ones need to be assigned a match type. This is what determines how aggressively or restrictively Google links user queries to your PPC advertisements.

There are many kinds of match types to choose from. The most common ones include:

  • Exact: This matches your PPC ad to a user query if the exact keyword was typed, with zero additions or changes made when it comes to the order of the words. 
  • Phrase: This matches your PPC ad to a user query if they typed the query in an identical order. This is the case even if additional terms were included before or after your keyword. 
  • Broad: As the name suggests, this matches your PPC ad to a user query regardless of the order that they typed the keyword. 
  • Close variants: This can be applied to the above types and gives a certain element of flexibility (e.g., allows for misspellings, variant words, etc.). 

There are several other important elements to building an effective PPC advertising campaign, including:

Negative Keywords

In conjunction with your positive keywords, PPC ads allow you to add negative keywords to stop certain users from seeing your ads. 

This works through a simple “disqualification” mechanism. For example, if a user types in a negative keyword, your ad will not be shown to them. Even though PPC advertising means that your ads will only cost you per click, it is still pivotal that you try to filter out as many uninterested or unqualified users as possible to increase your conversion rate. 

For example, if your business sells luxury products (e.g., antiques, etc.), you may want to include the word “free” as a negative keyword. This is because users searching for “free” products will likely prefer cheaper alternative options, and so you do not want them to click on your ad unnecessarily as this will cost you.

Audiences

Audiences are groups of users that can be separated based on their previous activity. This is usually used to either exclude or focus on a specific demographic of online users through remarketing. 

For example, a business may want to bid more to remarket its ads to the users who almost made purchases (e.g., added items to shopping carts, etc.) while excluding those that merely visited their business website.

Campaign Types

Your campaign type determines how your ads will be advertised, as well as what platforms they are advertised in. There are currently seven options for businesses to choose from. These include:

  • Search Network
  • Display Network
  • Video Campaign
  • Shopping Campaign
  • App Campaign
  • Local Campaign 
  • Smart Campaign

The Search Network

The Search Network consists of Google.com, as well as all of Google’s search partners (e.g., Amazon, AOL, Walmart, etc.).

The Search Network’s advertising is primarily keyword-based, meaning that users type in queries and are shown relevant ads. 

This is great as it can allow you to reach users who are only actively looking for what you are offering, leading to a higher click-through rate (CTR) and a higher number of conversions. 

Display Network 

The Display Network is a network that includes over two million online websites. These websites have partnered with Google and have agreed to show Google text, images, and video ads on their websites.

Unlike ads within the Search Network, ads are not shown to users based on what queries or keywords they typed in. Contrarily, they are shown to users in particular contexts (e.g., young business owners, etc.). 

Video Campaign

A video campaign is — as its name suggests — tailored towards video ads, meaning that it can be used to include video ads on YouTube or other applicable websites. 

There are six types of video campaigns, including:

  • Drive conversions: These include action-focused ads and targeting. This is a great option if you are looking to increase your sales or your total conversions.
  • Custom video campaigns: This is a custom option where businesses can work with a variety of different ad types.
  • Video reach campaigns: This allows businesses to get the most “reach” relative to the budget limitations that they have set (e.g., through bumper ads, skippable in-stream ads, etc.). 
  • Outstream: These video ads are viewable on mobile devices. They are shown to users on websites and apps outside of YouTube. 
  • Influence considerations: These are used to raise “consideration” for a product. They are usually skippable in-stream or in-feed video ads. 
  • Ad sequence: This allows businesses to “tell a story” through a series of video ads which are played in a sequence

Shopping Campaigns

Shopping campaigns are great for businesses’ product listings. They appear on Google’s search result page and the Google Shopping tab. 

In your shopping campaign, you may want to enable the use of local inventory ads. This will allow you to advertise all of the products you sell, including the ones that are exclusively sold locally. 

For instructions on how to enable the use of local inventory ads, see Google’s guide on promoting local inventory.

App Campaigns

App campaigns, like the name suggests, can be used to increase the number of users who use — and make purchases — within a business’s app. 

One of the largest benefits of using an app campaign is that it includes information from your business’s app. This enables it to “optimize” your PPC advertisements across millions of different websites and apps.

Local Campaigns

Businesses whose advertisements aim to bring people into their actual stores or venues can use local campaigns to:

  • Improve in-store sales 
  • Promote upcoming events
  • Allow persons to find a store’s location 

Smart Campaigns

Smart campaigns were designed to “streamline” the process of setting up a “conventional” Google ad campaign. Users simply need to enter their business information and create a couple of ads, and Google handles the rest. 

Smart campaigns are a great option for businesses with relatively low PPC marketing experience, as all ads and targeting are optimized automatically by Google. These campaigns can appear as search ads, display ads, or shopping ads.

Device Targeting

PPC advertising can be used to display ads on all devices, including:

  • Desktops and laptops
  • Tablets
  • Mobile phone devices

Desktops, laptops, and tablets are considered virtually identical when it comes to users, meaning that the same bid is applied to all of the devices. With mobile phone devices, a bid modifier can be applied. This can either decrease or increase the total bid (i.e., the maximum amount paid per click). 

Location Targeting

You can use PPC advertising to target specific locations — even down to specific zip codes. 

Keep in mind that different bid modifiers can be used for each location. This can allow advertisers to prioritize bids and allocate more funds to the locations with the most prospective customers.

Ad Scheduling

Pay-per-click ads can be scheduled so that they only appear at certain times during the day. This is extremely beneficial when it comes to maintaining a strong conversion rate and return on investment (ROI), as it ensures that your ads are only seen in the times where your targeted demographic is most active. 

This will depend on the nature of your business. If you are a traditional brick-and-mortar store, you may choose to schedule your ads so that they can only be seen during traditional business hours. Similarly, an online ecommerce business may run ads around the clock. 

Bid modifiers can be used when it comes to ad scheduling. This is both in relation to the days and time in which they are placed (e.g., setting a positive bid modifier for a Saturday when consumers are more likely to shop).

Budget

With each campaign, you will be required to set your budget. This is the total daily amount that can be exceeded, but it does not necessarily have to equate to what you will actually spend on a daily basis. 

This is because you will only spend money when users actually click on your advertisements.

Ad Extensions

Ad extensions are additions to your ads (e.g., URL links, supplementary information about your business’s products, etc.) that improve the effectiveness of your ads holistically. 

The main benefit of including ad extensions within your PPC ads is that they tend to significantly improve your click-through rate as they make your ads larger in size and thus more eye-catching to users.

Tools

Finally, it is important to keep in mind that you will have access to several online tools which have been provided by popular search engines (e.g., Google, Bing, etc.). 

These are important, as they can go a long way in helping you review and update your PPC ads.

There are many tools that you can use, including:

  • Keyword Planner
  • Change History
  • Ad Preview and Diagnostics
  • Automated Rules

Keyword Planner

Keyword Planner is a tool that was created by Google and can be found in Google Ads. 

It can be used by businesses and advertisers in order to estimate the starting bids and budgets for each campaign proactively. This is because the tool provides pivotal performance data estimations.

Change History

Change history can be found in both Microsoft Advertising and Google Ads. This tool allows businesses to see previous updates, including:

  • Sitelink additions
  • Bid changes
  • Date and time of modification
  • Email of person who made a modification

Since you can export change history, this can also be a great tool to share with shareholders and/or partners. 

Ad Preview and Diagnostics

This tool can be used if you need to understand why one of your ads is not displaying for a keyword or certain phrase. Similarly, it can help you understand why your ad extension may not appear or work as intended. 

Ad preview and diagnostics can also be used for comparative purposes. This is because the tool can be used to show a preview of a Google search result page for any specific keyword or term. 

This can allow you to see which ads are appearing instead of yours and make any necessary adjustments. 

Automated Rules

Automated rules can only be used on Google Ads. They can be used to make changes to your account’s ads automatically, based on certain conditions and settings that you have chosen in the past. 

The rules can be set rather flexibly, which means that they can be used very broadly. For example, you can choose to boost your keyword bid by a specific amount each time your ad falls off the first page of Google’s search results. 

Automated rules are great for “automating” quite a large part of running your PPC ads on a day-to-day basis without having to worry about making frequent changes. Having said that, you should keep in mind that these rules were not intended to replace human activity entirely and so should always be used as a supplementary mechanism.

Quick Tips for Successful PPC Campaigns

There are a few general “tips” that we have included that should help you out when starting out with your business’s PPC advertising campaign. 

Qualify Your Customers

As a small business, the last thing you want is to waste money on clicks from users that will not actually make a purchase.

This could be for many reasons, including a lack of information for the person clicking on your ad. 

Generally, you should try to “qualify” your prospective consumers so that they know as much as possible about your product before they click on your ad (e.g., your product’s price, etc.). This is because — even though your total traffic and CTR will undoubtedly be reduced — the number of clicks it takes for a user to make a purchase should decrease.

Learn From Your Competitors

Taking a look at what your competitors are doing, both correctly, and incorrectly, can be a very important step when starting out. 

The most successful PPC ads will be the ones that are shown on the top of the search result pages. Examine them closely, and see how they are different from your own PPC ads. This will allow you to make any changes that you need to relatively fast and improve your Quality Score and PPC ad ranking. 

Google also offers additional tools which you can use to compare yourself to competitors in your area, including Auction Insights Report and Ad Preview Tool.

Include a Call-to-Action

Including a call-to-action can be great for improving the effectiveness of your PPC ads. This is because it provides information that enables users to know exactly what they should expect to see after they click on your ad before they actually click on it. 

Once again, this can be a very effective way of improving your total conversions and sales — even if your total traffic goes down — as it can actively dissuade uninterested users.

Test Your Ads

Like with most forms of advertising, testing is key. 

Even if you have created a great ad on your first time — or you are an experienced PPC advertiser — testing your ad can allow you to analyze what works with your key demographic (and what doesn’t) and ultimately lead to a triumphant PPC advertising campaign.

Should I Use PPC Advertising for My Small Business?

PPC advertising can be a great way of marketing your business’s products and/or services while controlling your total advertising expenses. 

At the same time, PPC ads can allow you to target specific demographics while completely avoiding the ones who will likely not be interested in your services. This makes PPC ads a very effective advertising approach, both in comparison to other forms of digital marketing and in comparison to printed advertising methods. 

Other benefits of PPC advertising include:

  • Broad advertising reach
  • Always editable
  • Highly trackable

Broad Advertising Reach

Since you can take advantage of targeting and audiences in order to ensure that your ad will only show up to a specific type of user, PPC ads can be used to expand your marketing reach by ensuring that a larger number of “qualified” users actually sees your advertisement. In traditional advertising, this is not possible. 

Always Editable

Unlike printed advertising, PPC ads can be edited whenever you want and — since they are mobile-friendly — from wherever you want. As a business, you retain full control, which can save you a lot of headaches down the line. At the same time, you can use your control over every element of your ad to ensure that it is perfectly tailored towards your specific business model (e.g., scheduling ads for a particular time during the day, etc.). 

Highly Trackable

Since you can track the effectiveness of your PPC ads so easily, you will be able to see what works — and what does not work — with each campaign and make the adjustments necessary to increase your total conversions and sales.

Frequently Asked Questions

What’s the difference between an exact and broad keyword match?

With an exact keyword match, users will only see a business’s PPC advertisement if they search the exact same keyword phrase. No additional words or changes can be made. 

With a broad keyword match, on the other hand, users will be shown a business’s advertisement if they type in that specific keyword, variations of it, or related topics.

What is a negative keyword?

A negative keyword is a word that, when included by a user, automatically disqualifies them from seeing a particular business’s PPC ad. 

This can be great for controlling your PPC campaign’s costs by ensuring that the users who will likely not be interested in purchasing your products do not actually click on your ads.

Can I target my PPC ad?

Yes. PPC advertisements can be targeted to specific audiences or demographics. 

This includes specific:

  • Locations
  • Time and days
  • Devices (e.g., phone, tablet, desktop, etc.).
  • Ages 
  • Interests
  • Previous website behavior (e.g., cart abandoner, etc.). 

Can I make a PPC ad for Facebook?

Yes, you can make a PPC ad for most popular social media accounts, including:

  • Instagram
  • Twitter
  • Facebook
  • LinkedIn
  • TikTok
  • YouTube
  • Quora

Can I limit how much I spend on a PPC ad?

Yes. When creating your PPC ad, you will be able to set your “budget.” This will specify the maximum amount that you are willing to spend on your PPC ads daily. 

Of course, the amount you actually spend may be much lower depending on your CTR.