Today we’re coming at you with another relatively common question regarding PPC. What is pay per click vs impression?
Pay-Per-Click experts might scoff at this question but that’s a bit unfair. For us, defining this is simple but if you ask us a basic question about grading necessary for drainage during new home construction, most would stare at you blankly. The point is, the topic is worth covering for those that are unfamiliar with pay-per-click (PPC).
Pay Per Click
Pay per click is easy enough to define because it states what it is. You only pay, when your ad is clicked. So if I show John, Joe, and Suzy your ad 500 times but they never click, you don’t pay (and we should really consider using a new ad).
If I show them the ad 1 time, and one of them clicks, you pay for that click. These type of online ads are easy enough to set up on a platform such as Google Adwords, but the managing of it gets a lot more complicated. When you create a PPC ad on Google Adwords, you can set a daily budget limit as well as a cost-per-click limit. This means, if I don’t want to pay over $2 for someone to click on my ad, I can set that as the limit. Additionally, if my marketing budget only allows me to spend $10/day, I can set that limit as well.
It is a beautifully efficient use of your hard earned marketing dollars. They only get used, when someone expresses interest in your ad.
Impression-based ads are a little different with how the ad spending goes. With a traditional newspaper ad, you pay for a specific size ad in a section of the newspaper. This price is based on placement, amount of colors used, size, and the paper’s estimated circulation. The circulation is very similar to impressions. They are estimating X amount of people to read the paper, thus see the ad. The one downfall to that is that their circulation numbers are hypothetical and your ad is guaranteed to be seen.
When it comes to impression-based ads on Google Adwords, you have a bit more control. For example, you can pay-per-CPM or Cost-Per-Thousand impressions. Remember that limit we were able to set on how much we would pay for a click? The same can be applied here. I want to only pay $5/CPM. So I will pay $5 for every thousand impressions. Simple enough. So instead of paying for an interaction with your ad, you are paying for the views of your ad.
There is one caveat and that is, your ad may not have been seen. You can’t state for certain if a person’s eyeballs were on the computer screen when they scrolled past your ad. You can however, tell that the ad showed up within the view of their screen, making it a little more certain than the circulation numbers of a newspaper.
Which is Better: Pay Per Click or Impression?
To answer this bluntly; it depends.
It depends on the type of campaign you are running. For example, if you want to increase traffic to your website in order for them to convert into customers, you are better off with the pay per click model.
If you are launching a rebrand or advising customers of alternate hours during the holidays, you might be better of with impressions. The reason is that these types of circumstances may not require a visitor to go to your site. Here is a great example:
Hospital A wants to let people know they have immediate care clinics open on Thanksgiving day. A well-designed ad can get that across without the viewer needing to click through to an actual webpage. Paying by impression can give you a tremendous amount of eyeballs, without having a huge ad budget.
So a general rule of thumb:
Use Pay Per Click – when you want to drive website engagement, interaction, and conversions
User Impressions – when you want to create awareness