With the arrival of new PPC competitors in the advertising market for your product or services, it may or may not impact your campaigns. There are a number of factors to consider.

A good analogy is to consider the impact of a stone being thrown into a pond.  We might ask, what is the size of the pond, it’s depth; how large is the stone, and how much force was it thrown with. In paid search campaigns, some markets are the size of large regional lakes whereas others are the size of a pond. Some PPC competitors arrive like they were shot out of a cannon, bidding aggressively with sizable budgets. Others are not even noticed.

In a search ad campaign, the most likely result of new advertisers participating in a market is for bidding to become more competitive. That drives average click prices (CPC’s) higher which in turn drives CPA’s higher.  But it depends on the size of the market, quality scores, campaign budgets, and how aggressively market participants are bidding.