PPC, as Pay Per Click is more handily known, is a prominent method of Internet marketing.   Advantages of this model are its straightforwardness and ease of use.  With PPC, advertisers do not actually pay to have their ads featured.  Instead, their ad is displayed for free, but they must pay the host (such as Google, Yahoo!, or some advertising network) when it is clicked.  For search engines, advertisers usually bid for keywords (or phrases) in an auction-like mechanism.  Three of the largest PPC platforms – Google AdWords, Yahoo! Search Marketing, and Microsoft AdCenter – operate their model by means of bidding.

When a user conducts a search on Yahoo! or Google, the results feature a section of “sponsored ads” along with the organically-generated links.  The sponsored results generally span across the top, along the sides, and/or around the bottom of the page.  These advertisements are meant to match up with the term from the search.  For example, if you search for “desktop printer” on Google, the results may feature ads related to Xerox or Hewlett-Packard.  This means these two companies participated in bidding for the keyword/phrase “desktop printer.”

Various safeguards have emerged to help ensure good practice in PPC.  Particularly troublesome for this advertising model has been “click fraud” – a type of Internet fraud when a person, program, or automated script of some sort clicks advertisements with the intention of generating income without actual interest in the ad itself.  In many jurisdictions, this could be considered as a felony.  Some search engines such as Google have also made efforts with their own automated scripts to counteract this type of abuse.