PPC is probably one of the most cost-effective ways of targeted advertising on the internet. Forbes magazine has reported that PPC, or Pay Per Click, accounts for 2 billion dollars a year and is expected to increase to around 8 billion dollars by 2008.

Here is a brief look at how PPC works.

PPC search engines create listings and rate them based on bids placed by the advertiser. These bids are what the advertiser is willing to pay for each click received from that search engine. Advertisers must bid against each other to get a higher ranking for their keywords and so achieve a better position in the search engine. The highest bidder for a certain keyword will be ranked as number 1 in the PPC Search Engines, followed by the second and third highest bidder and so on, up to the last advertiser to have placed a bid. Your adverts will then appear prominently on the results pages dependent upon the dollar amount bid that you have agreed to pay per click.

So how do you make money by using PPC?

Affiliate programs only pay when a sale has been made or lead delivered by clicking through to your site. Your earnings will depend on the strength of your PPC ad which determines your CTR (click through rate), and the strength of your sales page.

PPC should be in your advertising arsenal because it is the ONLY way to practically guarantee a good position in the search engine listings thus giving you more of a chance to make a sale.

PPC can be very useful for your website. You will not only get sales from those who are searching the web to find the products and services that they want, but you will also be able to build your site's authority as a valuable resource. The visitors who have found what they wanted from your site are more than likely to come back and see what you are offering more closely. This will give you a chance of repeat custom and even more income. It is a good idea to build a list of your customers details by incorporating a form on your website for them to complete. Lists built like this give you a strong market to cater too.

If you don't have a website and product of your own to promote, there are plenty of affiliate sites to profit from. These affiliate sites have ready made products and websites for you to promote, and you receive a percentage of the profit from every sale you make. They will even give you sales copy and other tools and resources to help you in your marketing efforts. This is an excellent idea. You need have no storage facilities and will have no fulfillment costs. All you have to do is advertise the products and any sales will be dealt with by the affiliate owner.

So all in all PPC is a must have resource in your on-line business.