PPC bids are often separated by pennies.The top bid might be $2.00, the second $1.97, the third $1.96. If you recognize larger gaps, you can reduce your CPC.

Bid Position CPC

1 $2.00

2 $1.97

3 $1.96

Bid Gap $1.25

5 $1.24

6 $1.23

7 $1.20

Bid Gap $0.95

9 $0.94

Is it worth to pay $1.96 instead of $1.25, to move from position four to position three? It might, or it might not. It depends on your maximum CPC. If your CPC is closer to $1.25 than it is to $1.96, it is an easy decision to make.

Contextual PPC Advertising

Contextual advertising is a great way to add relevant advertising to any web page. It is the ideal revenue source for content-based websites such as a blog, a news site, or an article site. With this form of advertising, targeted ads appear determined on the page content.

Contextual advertising is a hotly debated topic among PPC advertisers. Many advertisers complain that contextual PPC offers poor ROI (Return On Investment). PPC advertisers often don't understand the difference between regular PPC and contextual PPC. As regular PPC ads show within search results, contextual PPC ads show on content network sites.

Contextual advertising is similar to banner advertising. The sites displaying the ads are hoping that the site visitors will click the ads at some point. Contextual advertising converts at a lower rate than normal PPC, because, instead of clicks, it mostly generates ad impressions. In other words, just like most banner ads, contextual ads are mostly ignored. This form of advertising might not result in great sales results, but it might be great to create brand awareness.

If you are new to PPC advertising, it is best to turn off this feature. Once you become more experienced, you might start contextual ads for some of your best converting campaigns. Lower your bids for contextual advertising until you have a chance to measure performance.

Geo Targeting

Refining your PPC campaign might require geo targeting. Geo targeting is the technology that enables PPC advertisers to target certain geographical areas. Search engines perform this task by filtering searchers based on IP address.

Geo targeting enables your business to limit searches to people within your desired geographical area. For example, if you own a flower shop, you might only want your advertising to appear to searchers in your immediate geographical area.

Taking advantage of geo targeting might reduce the number of competitor websites you have to compete with for your keywords. Geo targeting also helps you focus in on the specific market.

A good PPC search engine should enable you to target your ads to:

? a radius around your business,

? any zip code,

? any metropolitan area, or

? any defined coordinates.