There are many different types of bidding strategies available to businesses in search engine marketing. Each method has its own unique set of benefits and drawbacks, so businesses need to understand which method will work best for them.
In this article, we’ll take a look at the two most common methods of bidding strategies google ads has to offer in paid advertising in search engine marketing: cost-per-click (CPC) and cost-per-thousand impressions (CPM). We’ll also discuss some of the other less common bidding strategies, such as cost-per-action (CPA) and cost-per-lead (CPL).
What is CPC?
Cost-per-click (CPC) is a type of paid advertising that allows businesses to pay for their adverts to be shown on search engine results pages (SERPs) in response to certain keywords or phrases. The amount that businesses pay for each click on their advert depends on several factors, including the competitiveness of the keyword or phrase that they are bidding on.
The main benefit of CPC advertising is that businesses only have to pay when someone clicks on their advert, so there is no wasted spending. This makes it a very effective way of driving targeted traffic to a website. The downside of CPC advertising is that it can be very expensive, especially for competitive keywords.
Google CPC pricing plans: Google offers two different CPC pricing plans for businesses to choose from:
The Standard plan charges businesses a set amount for each click on their advert, regardless of the keyword or phrase that they are bidding on. The amount charged depends on the country in which the business is based and the currency that they are using.
The Enhanced CPC plan charges businesses a higher amount for each click on their advert when the keyword or phrase is predicted to result in a conversion (e.g. a sale). This means that businesses have the potential to spend more with this pricing plan, but they are also more likely to see a return on investment (ROI).
Bing CPC pricing plans: Bing offers businesses two different types of CPC pricing plans- standard and accelerated. With the standard CPC plan, businesses only pay when someone clicks on their ad. The accelerated CPC plan is a bit more expensive, but it allows businesses to have their ad displayed more often, which can lead to more clicks and conversions.
What is CPM?
Cost-per-thousand impressions (CPM) is a type of paid advertising that allows businesses to pay for their adverts to be shown on search engine results pages (SERPs) in response to certain keywords or phrases. The amount that businesses pay for every thousand impressions of their advert depends on several factors, including the competitiveness of the keyword or phrase that they are bidding on.
The main benefit of CPM advertising is that businesses only have to pay when someone sees their advert, so there is no wasted spending. This makes it a very effective way of getting exposure for a website. The downside of CPM advertising is that it can be expensive, especially for competitive keywords.
Google CPM pricing plans: Google CPM pricing plan offers businesses to pay a set price for their ad to be shown 1,000, the prices may vary based on the advertiser’s industry, country, and the time of year. For example, during busy holiday shopping periods, prices will be higher than average.
Google Ads vs Bing for Paid Advertising
There are a few key differences between Google Ads and Bing when it comes to paid advertising. The main difference is the size of their respective search engines- Google is by far the largest, with around 65% of the global search engine market share, while Bing has around 20%. This means that there is much more competition for keywords on Google, which drives up the cost-per-click (CPC) prices. Bing is also less sophisticated than Google when it comes to matching ads to searchers’ intent, which can lead to a lower click-through rate (CTR).
Another key difference is that Bing allows businesses to target ads by location, while Google does not. This means that businesses can ensure that their ads are only shown to people in certain countries or states, which can be very useful for local businesses.
Finally, Bing allows businesses to use negative keywords to exclude certain terms from their campaigns. This can be very helpful for preventing your ad from being shown for irrelevant searches and can help to improve your CTR and ROI.
Google Ads and Bing Ads (Now partner with Microsoft) are the two main paid advertising platforms for businesses to use. They both have their own unique set of benefits and drawbacks, so it’s important to understand which one will work best for your business. If you’re not sure which platform to use, we recommend starting with Google AdWords, as it is the more popular and sophisticated of the two.
What Are The Other Types Of Paid Advertising?
There are several other less common types of paid advertising in search engine marketing, such as cost-per-action (CPA) and cost-per-lead (CPL).
CPA is a type of paid advertising that allows businesses to pay for each action that is taken on their ad. This can include clicks, conversions, or even leads. CPA is a great way to ensure that you are only paying for results, and not wasting spending on ads that do not convert. The downside of CPA is that it can be more expensive than other types of paid advertising, as you are essentially paying for each lead or conversion that you generate.
CPL is a type of advertising that allows businesses to pay for leads that are generated from clicks on their ads. This type of advertising is often used by businesses that offer products or services that require a lot of research or consultation before purchase, such as financial services or legal services. CPL advertising can be a great way to generate high-quality leads, but it can also be very expensive, so it’s important for businesses to carefully consider their target audience and budget before deciding if this type of advertising is right for them.
Note: Mind that when it comes down to CPL vs CPM/CPA, CPL price is significantly higher than the other 2 models, making it less attractive for small businesses with a limited advertising budget.
Which Type Of Paid Advertising Is Best For My Business?
The answer to this question depends on several factors, including the goals of your advertising campaign, the budget that you have available, and the competitiveness of the keywords or phrases that you are bidding on.
There are many ways to do this: You can use Google AdWords, Facebook Ads, Twitter Ads, LinkedIn Ads, or any other number of paid advertising platforms. You can also use a combination of these methods to create an effective paid advertising campaign. But first, let us learn about each individually.
#1 Analyzing the goals of your advertising campaign
The first step in choosing the best type of paid advertising for your business is to analyze the goals of your advertising campaign. What are you trying to achieve with your campaign? Are you looking to generate more traffic to your website? Are you looking to increase sales or leads? Once you know what you want to achieve, you can start to look at the different types of paid advertising and see which one will be the best fit for your business.
#2 Consider your budget
The next step is to consider your budget. How much are you willing to spend on paid advertising? This will have a big impact on which type of paid advertising you choose.
Choosing from CPA, CPM, CPA, or CPL based on pricing:
If you have a limited budget, then you may want to consider using CPC or CPM advertising. These types of advertising let you set a maximum amount that you are willing to pay per click or thousand impressions. This can help you control your costs and ensure that you don’t overspend on your advertising campaign.
If you have a larger budget, then you may want to consider using CPA or CPL advertising. These types of advertising let you pay for leads or sales that are generated from your ad. This can be a great way to generate more business, but it can also be more expensive. You will need to carefully consider your budget and the competitiveness of the keywords or phrases that you are bidding on before deciding if this type of advertising is right for you.
#3 Analyzing the competitiveness of your keywords
The final step is to analyze the competitiveness of the keywords or phrases that you are bidding on. If you are bidding on very competitive keywords, CPC and CPM advertising can be very expensive. In this case, you may want to consider other options such as CPA or CPL.
Once you have considered all of these factors, you should have a good idea of which type of paid advertising will be best for your business. But, If you are still not sure which type of paid advertising is best for your business, then it is advisable to speak to a search engine marketing specialist who will be able to advise you on the best course of action.
Choosing from 4 options is easier than choosing from millions, but each method has its own unique set of benefits and drawbacks, so it’s important for businesses to understand which method will work best for them.
And to make sure you are doing it right, hiring an agency to do it for you is the wisest option. And if you need help getting started, 12 Channels is the best agency to help you with your paid advertising needs. With our team of search engine marketing specialists, we will make sure that your campaigns are successful and that you are getting the most out of your budget. Contact us today to learn more!