How PPC works

Hi,
All Webmaster do you have Knowledge About How PPc is Working.Now a days PPc is most oriented to get traffic.There are mainly masore six step to follow for those are working on ppc
PPC advertising works on simple principles:
1. Build a list of keywords.
2. Write some ads for every class of keywords.
3. Bid for your position on each keyword.
4. When people make searches using your keywords, the search engine displays your ad on the results page.
5. Some people click on your ad (you pay for those clicks).
6. Some of those people buy your product/service