Definition of sponsored search advertising

In sponsored search, when a consumer searches for a term using a search engine, the advertisers' webpage appears as a sponsored link next to the organic search results that would otherwise be returned using the neutral criteria employed by the search engine.

Companies that wish to advertise their products or services in this way submit product information in the form of specific keyword listings to search engines. Bid values are assigned to each individual advert to determine the position of each competing listing on the search engine results page when a user performs a search. 

By allotting a specific value to each keyword, advertisers only pay the assigned price for the users who actually click on their listing to visit their websites in the most prevalent payment mechanism, known as cost per click (CPC).

Search engines leverage their value as information-locating tools by selling advertising linked to user-generated queries and referring consumers to the advertisers, and such sponsored-search advertising has become the most predominant form of online advertising.

Example

If someone searched for 'bed sheets' on Google, Yahoo or Bing, advertisers such as Macy's,  J. C. Penney, Amazon and so on might show up with their sponsored ads in response to that query. [1]

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