Pay per click (PPC) advertising allows a business to pay for their advert to appear at the top of a search engine results page (SERP), thereby essentially paying for clicks and receiving more traction to their website.

This PPC method has largely been regarded as a great digital marketing tool especially for small businesses to use when looking at breaking into a new market. Having PPC adverts allows smaller companies to appear higher on SERP’s and therefore receive more interactions, this is a much better alternative to use these smaller companies build SEO reputation with quality content, something that takes time.

Not only does PPC produce more favourable results than SEO for smaller businesses (Cain, 2016) but a huge benefit on top of that is the ability to appeal to a large audience in a small amount of time. As Lombardi (2011) stated “When immediate results are desired, paid advertising is a powerful strategy for generating nearly instantaneous traffic after the campaign has been launched”.

It is uncommon for large multinational businesses to use PPC as a method of digital marketing, and this is assumed because they usually have brand recognition and great SEO rankings that they don’t have to pay for clicks, their reputation does it for them. However, due to the lack of multinational businesses doing so, it could work as a competitive advantage for businesses in a large oligopoly for example, giving them another angle to steal customers from competitors, especially in markets where brand loyalty is a struggle. Sullivan (2003) states “PPC advertising can become increasingly expensive for companies as they are locked in bidding wars over the same keywords, driving up each other’s costs”. Having a lack of competitors using PPC means this won’t be a problem and remains an obstacle for smaller companies whose competitors all use PPC.

Another good use for larger companies is the ability to target audiences with specific adverts. Large companies have large product portfolios all targeting different markets and segments, so adopting an initiative that can cater to different market segments is surely beneficial no? The Google AdWords account can allow ads to target selective audiences and be shown at specific times of the day.

For example, an ice cream business is influenced heavily by seasonality, so it can create adverts to only show when the weather is above certain temperatures, and will only target parents, who will go and buy ice cream for their children. This was shown to be the case when Manning Gottleib were appointed to take charge of the marketing strategy of Starbucks, and used weather factors ot influence when adverts were shown (Dar, 2000).

Larger companies also have a large budget to accommodate their size. Research has shown that the most effective PPC campaigns are the ones which cost the most, and to be successful a large budget for PPC is required, usually at least £500 a month is required to be effective (Sullivan, 2003). Essentially the more you spend on PPC the more you will get back. This increased budget can also help pay for trained staff to manage the account, which research shows leads to a higher success rate for PPC campaigns (Sen, 2005).

On the other hand, PPC can offer a more difficult platform for larger companies to compete on. Larger companies prefer to use an SEO approach due to the main reason that it’s free. A lot of people refrain from clicking the first results they see on a SERP regarding it as spam and not good quality, whereas SEO ranking is based on having good quality relevant content, and large companies have usually established this already.

Overall, only certain large companies can really reap the rewards of PPC marketing. Being in the right market is essential, as large companies are constantly competing for market share stealing competitors can play a big part. So operating in a market where brand loyalty is tough to maintain could mean PPC will be a successful strategy, for example, the confectionary industry. Another must for a large company to utilise PPC is having some brand recognition, this will counter act the stigma of adverts in a SERP being spam if the viewer can identify the company behind it.

If you’re a small business wanting to use PPC here’s why you should. That being said, in order to be successful you need to know what you’re doing large or small business, so here’s a useful link on the do’s and don’ts when staring up a PPC account.

References

Cain, E. (2016). How to use SEO and PPC the right way (5 short case studies). Available: http://www.pagewiz.com/blog/ppc/seo-and-ppc. Last accessed 07/04/17.

Dar, I. (2000). Manning Gottleib wins Starbucks media strategy and buying tasks. Available: http://www.campaignlive.co.uk/article/manning-gottlieb-wins-starbucks-media-strategy-buying-tasks/45902. Last accessed 17/04/17.

Lombardi, G. (2011). SEO vs. PPC: Which strategy will deliver you biggest ROI? Dental economics. 101 (10), p1-4.

Sen, R. (2005). Optimal search engine marketing strategy. International journal of electronic commerce. 10 (1), p9-25.

Sullivan, T. (2003). Competitively using Pay per click advertising. International journal of electronic commerce. 7 (3), p14-15.