A method of displaying advertisements on third party websites, search engine portals and advertising networks, paying the publisher based on pre-agreed rates for the number of visits generated through the ads on those websites has been named PPC and has been widely popular in the internet market.

There are two primary models for determining cost per click: flat-rate and bid-based

In the flat-rate model, the advertiser and the publisher agree upon a fixed amount that will be paid for each click.

In the bid-based model, the advertiser signs a contract that allows them to compete against other advertisers in a private auction hosted by a publisher. An advertiser can bid the maximum amount that he or she is willing to pay for a given ad spot; the highest bidder gets to place their ads on the publisher's webpage, and they pay the agreed bid amount.

Keyword selection for placement on Pay Per Click campaigns need to be done based on competitiveness and relevancy of a keyword to the type of business your website performs; the right key words will help draw in targeted traffic that carries the most probability of getting converted to sales.

Although Pay Per Click advertisement model is an excellent way to bring new customers to your business, failing to manage the campaign properly will result in a big waste of your precious advertisement money.