This is a popular mode of calculating payment there are two primary ways for determining cost per click flat-rate and bid-based. In these methods the advertiser must consider the potential value of a click from a given source. This value is based on the type of individual the advertiser is expecting to receive as a visitor to his or her website, and what the advertiser can gain from that visit, usually revenue, both in the short term as well as in the long term. like the other forms of advertising target is key and  target’s interest defined by  the search engine, or content of the page browsing location is also targeted for geographic related tasks and the day and time that they are browsing.

Flat-rate pay per click is a flat-rate model, in this calculating methodthe advertiser and publisher agree upon a fixed amount that will be paid for each click. In many cases the publisher has a rate card that lists the counts of the click which differ within different areas of their website or networking site. These amounts are related to the content on pages, with content that generally attracts more valuable visitors having a higher pay per click than content that attracts less valuable visitors. However, in many cases advertisers can negotiate lower rates, especially when committing to a long-term or high-value contract.The flat-rate model is common in shopping engines, which have their rate cards, these rates are minimal, and advertisers can pay more if he requires more advertising and popularity. These sites are divided into product or service categories, and have a high rate of targeted customers. In many cases, the entire content of these sites is paid ads.

Bid-based pay per click in this method the advertiser signs a contract that allows them to compete against other advertisers in a private auction in an an advertising network. Each advertiser informs the host of the maximum amount that he or she is willing to pay for a given ad spot which is based on a keywords using online tools to do so. The auction plays out in an automated fashion every time a visitor triggers the particular spot.

When the ad spot is part of a search engine results page (SERP), the automated auction takes place whenever a search for the keyword that is being bid upon occurs. All bids for the keyword that target the searcher’s geo-location, the day and time of the search, etc. are then compared and the winner determined. In situations where there are multiple ad spots, a common occurrence on SERPs, there can be multiple winners whose positions on the page are influenced by the amount each has bid. The ad with the highest bid generally shows up first, though additional factors such as ad quality and relevance can sometimes come into play (see Quality Score).

Inmany cases the advertiser allows the content of the advertisement to be placed in priorities of the third party with whom they have partnered. These publishers sign up to host ads on behalf of the network. In return, they receive a portion of the revenue that the network generates; the Content may include links to websites, newsletters, and e-mails and blogs.

Advertisers pay for each click they receive, with the actual amount paid based on the amount to maximize success and achieve  on a higher scale, bid management systems can be used, These systems are used by the advertiser and are commonly used by advertising agencies that offer bid management as a service, these click management systems are a highly automated system generally each bid based management has a goal that is set to maximize profit, and managemaximum traffic these system is usually tied into the advertiser’s website to record each click, which then allows it to set the bids. The effectiveness of these systems is directly related to the quality and quantity ads