Pay per click or PPC advertising is possibly the easiest and most effective way to market your business online. Getting your website listed in the search engines is vital due to the fact that the majority of website traffic (statistics say over 80%) comes from the search engines. Effective PPC management begins with devising a strategy to drive qualified traffic to your website.

PPC (PPC) advertising is simply advertising your website through the use of the search engines sponsored listings. When using PPC you bid on keywords or keyword phrases that your targeted prospects may use to find whatever your website offers. Yahoo! Search Marketing (formerly known as Overture) for instance, only considers the bid amount in ranking a site. The most popular PPC Google Adwords uses bid value and your success (click through) rate.

To develop a your PPC strategy and plan, you must conduct market research. This should consist of identifying your target market (preferably a niche market), identifying keywords that your target market uses to search for what you are offering, and analyzing the keywords and alternative keywords that will appeal to your target market.

During your keyword analysis, you will want to find out how popular keywords are and what the average bids are for certain keywords you are considering for budgeting purposes since defining a budget is a necessary part of PPC management.

Budgeting for PPC advertising involves not only determining how much money you can spend on your campaign, but basing that on the monetary value of a click to your website since you are paying per click.

Your conversion rate, the number of unique visitors divided by the number of sales, plays an important role in determining the value of a click to your site for PPC advertising budgeting purposes as does the average net profit per sale. By dividing your net profit per sale by your conversion rate, you can accurately determine the value per click to your website. The price per click that you pay for your PPC advertising should not, of course (!!!) exceed this value.

So if your selling a product that gives you a 10 profit, and a particular keyword takes 50 visitors to create a sale you would bid no more than 0.20 per click to break even.

A few tips about PPC if you DIY.

1. Dont put more money than you have to into your account sounds obvious but.!

2. Test, test, test have at least two separate ads for the same product at the same time. Drop the lower performing adverts and add a new one until you are satisfied with the results.

3. Make sure to keep up with your results daily at the very least and adjust your strategy according to results.

4. Continue to look for new keywords and as you find new ones lose the poorer performers.

If you approach PPC advertising logically, follow the direct marketing mantra of test, test, test, monitor results regularly and make adjustments only according to results PPC advertising is a powerful tool for driving profitable traffic to your site.