An Explanation of Keywords in PPC

The last article in the ‘A Complete Explanation Of PPC’ series looked at the CTR or Click-Through Rate of a PPC campaign, what it means, what variables can change the CTR of an advert and what type of CTR is good for a campaign. In this article, I will be looking at keywords in PPC, what they mean to a campaign and how to choose them.
 
The keywords in PPC are basically what makes PPC contextual. The idea is that the advertiser chooses a group of keywords for which he wants his/her advert to show when the web user searches for that keyword or similar. Therefore, it is vital to the success of a PPC campaign that the advertiser chooses the right keywords so s/he can make sure only the most relevant traffic enters onto his/her landing page.
 
The problem is that the keywords you choose will affect the CPC of your advert. Different keywords have different prices based on the competition by advertisers to show adverts for them keywords. An example of this is the keyword ‘insurance’ which has a CPC of $55! This makes it clear that you should choose your keywords based around:

1. Your budget. You don’t want to spend out your whole budget to one click. See what type of CPCs you get for different keywords and judge what keywords to use based around how much traffic you want to gain from the budget you are on.
2. The conversion rate – By experimenting with different keywords, you will be able to see which keywords produce the most conversions on your landing page.

It’s a constantly struggle of whether you should pay out loads for good keywords in the attempt to get good conversions or risk spending cents for traffic that, will get a very low conversion rate, but, with the added traffic, may turn out to gain you more conversions in the long run. It’s always best to experiment.
 
Now that we have clarified what keywords are in essence, it is important to know that there are different types of keywords an advertiser can choose. There’s the obvious choice to choose keywords that are related to the content of your campaign. For example, if you sell cars,  a keyword phrase would be ‘buy car’. However, that will get lots of competition. Therefore, you might find the CPC will decrease the more specific you go such as ‘buy eco friendly second hand car’ or ‘buy zero emissions second hand car’.
 
As well as this, there are negative keywords you can choose to use. AdWords makes it possible to allow advertisers to not only bid on keywords that want to gain clicks on, but to prevent their campaigns from bidding on keywords/combination of keywords they don’t want to gain clicks on. An example of this would be to have the negative keyword ‘buy new car’ (for my example of a campaign selling eco-friendly used cars) since the web user is not interested in used cars and the traffic will not be as high quality. Negative keywords eliminates wasteful money going into low converting traffic.