The PPC (Pay per Click) model is used in online advertising to attract more visitors for target websites and the advertisers have to pay for every click on their advert. In simple term, it is referred as the amount that has to be spent to generate a click on the target advert. In major search engines such as Google, advertisers place bids for relevant keywords and phrases relevant to their target audience. On the contrary, content sites follow a fixed-price model instead of the regular bidding model. The adverts displayed through PPC model are often called either few line Text and banners and these are displayed on websites and search engines that are ready to promote the advertiser.
An advertisement is displayed on a website using PPC adverts only when the keyword query is similar to the keyword list provided by the advertiser or upon the display of relevant content by a content site. These are often called as sponsored ads or sponsored links. These adverts are visible below the organic search results or anywhere on the content site according to the location selected by the developers.
PPC model is held together with the basic principle of making affiliates that allows generating more potential purchases from users. This is a contradictory approach as compared to the general portal where the sole purpose is to generate more traffic for the website. PPC model offers monetary incentives to its affiliates, which comes from the conversions/sale. The main role of affiliates is to offer purchase-point click-through to the advertiser/merchant. Pay-for-performance is the ruling principle in this approach: An affiliate who is unable to generate any sales does not cost money to the merchant/advertiser. There are some variations available under this model including revenue sharing programs, PPC, and banner exchange.
