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Pay Per Click (PPC) is an advertising model used on search engines, advertising networks, and content websites or blogs, where advertisers only pay when a user actually clicks on an ad to visit the advertiser's website. Advertisers bid on keywords they predict their target market will use as search terms when they are looking for a product or service. When a user types a keyword query matching the advertiser's keyword list, or views a page with relevant content, the advertiser's ad may be shown. These ads are called a 'Sponsored link' or 'sponsored ads' and appear next to or above the natural or organic results on search engine results pages, or anywhere a webmaster or blogger chooses on a content page.

Pay Per Click ads may also appear on content network websites. In this case, ad networks such as Google AdSense and Yahoo! Publisher Network attempt to provide ads that are relevant to the content of the page where they appear, and no search function is involved.

While many companies exist in this space, Google AdWords, Yahoo! Search Marketing, and Microsoft adCenter are the largest network operators as of 2009. Minimum prices per click, often referred to as Costs Per Click (CPC), vary depending on the search engine, with some as low at $0.01. Very popular search terms can cost much more on popular engines. Arguably this advertising model may be open to abuse through click fraud, although Google and other search engines have implemented automated systems to guard against this.

PPC Management Categories:
PPC engines can be categorized into two major categories 'Keyword' or sponsored match and 'Content Match'. Sponsored match displays your listing on the search engine itself whereas content match features ads on publisher sites and in newsletters and emails.

There are other types of PPC engines that deal with Products and services. Search engine companies may fall into more than one category. More models are continually evolving. Pay Per Click programs do not generate any revenue solely from traffic for sites that display the ads. Revenue is generated only when a user clicks on the ad itself.

Keyword PPCs:
Advertisers using these bids on keywords, which can be words or phrases, and can include product model numbers. When a user searches for a particular word or phrase, the list of advertiser links appears in order of the amount bid. Keywords, also referred to as search terms, are the very heart of pay per click advertising. The terms are guarded as highly valued trade secrets by the advertisers and many firms offer software or services to help advertisers develop keyword strategies. Content Match, will distribute the keyword ad to the search engine's partner sites and/or publishers that have distribution agreements with the search engine company.

As of 2007, notable PPC Keyword search engines include: Google AdWords, Yahoo! Search Marketing, Microsoft adCenter, Ask, LookSmart, Miva, Yandex and Baidu.

Online Comparison Shopping Engines:
Product Search Engines let advertisers provide feeds of their product databases and when users search for a product, the links to the different advertisers for that particular product appear, giving more prominence to advertisers who pay more, but letting the user sort by price to see the lowest priced product and then click on it to buy. These engines are also called Product comparison engines or Price comparison engines.

Some Online Comparison Shopping engines such as Shopping.com use a PPC model and have a defined rate card. Whereas others such as Google Product Search, part of Google Base (previously known as Froogle) do not charge any type of fee for the listing but still require an active product feed to function.

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