How do Google Ads work?

keywords

Deciding to use Google Ads is one of the best decisions you can make for your business.

When people are looking for a product or service, their first stop in their search is usually Google. Over 3.5 billion searches are made on Google each day.

By using Google Ads for your business you will see more leads, conversions, and sales.

Using Google Ads will allow your business to advertise and promote your products and services whenever users search relevant keywords.

Google ads have amazing potential for businesses when used correctly.

We’ll go over how Google Ads work, and how to get them set up for your business.

What is Google Ads?

Google offers a paid online advertising platform, called Google Ads. Some may remember it as Google Adwords.

Google Ads was originally known as Google Adwords, and was rebranded to the current name in 2018.

While it is no longer called Google Adwords, the way Google Ads works is essentially the same.

When users are searching on Google, the results on their query will display on the SERP, or search engine results page.

The results shown can include a paid advertisement, that is set to display when a targeted keyword is used.

As and example, here you can see the Google search results for the words “Photographer in Los Angeles”

Google Ads

As you can see, the top results on the search engine results page are ad results. They look almost identical to organic search results, except for the bold “Ad” at the top of the result.

What this means for the advertiser is their result will typically get the most traffic, because they appear at the top of the search.

It should be noted however, that using Google Ads doesn’t automatically ensure the top spot on the SERP.

You competitors are likely using Google ads to advertise as well, and will probably be using the same or similar keywords through Google Ads.

To understand how search results are ranked, you’ll want to take a look at how Google Ads works.

How Do Google Ads Work?

Google Ads using a PPC or pay-per-click model.

What this means, is marketers will target a specific keyword on Google ads, then they will make bids on that keyword, bidding against their competitors who are also looking to use that keyword to advertise on Google.

You will bid by setting the “maximum bid” which is the most you are willing to pay for the ad.

For example, if your maximum bid is $5 and Google determines that your CPC or cost-per-click is $3, you will get that ad placement! If Google determines that it is more than $5, you will not get the ad placement.

You can also set a maximum daily budget for your Google ad campaign.

This will ensure you don’t go over what you want to spend on online advertising for each day.

This is a great way to determine your budget and stay on target.

There are 3 options when it comes to placing bids:

  1. CPM (Cost-per-mille)  This is how much you will pay per 1,000 ad impressions
  2. CPC (Cost-per-click) This is how much you will pay when a user clicks on your ad.
  3. CPE (Cost-per-engagement) This is how much you will pay when a user performs a specific action such as watching a video, signing up for a newsletter, etc.

Google will then conduct a Quality Score on your ad.

According to Google:

“Quality Score is an estimate of the quality of your ads, keywords, and landing page. Higher Quality Scores can lead to lower prices and better ad positions.”

Your Quality Score on Google Ads is ranked on a scale between 1-10 – with 10 being the highest, or best Quality Score.

The higher your Quality Score, the better your ads will rank, and the less you will spend on conversions!

Google then combines your Quality Score, with your bid amount, and creates your Ad Rank – this is the position your ads will appear in the search results page.

When a user views your ad and clicks on it, you’ll then pay a small fee for that click (thus pay-per-click).

The more users click on your ads, the better the chances are that you will reach your online advertising goal (e.g. make a purchase, sign up for a newsletter, etc).

Now that we have the basics of how Google ads work, let’s look at the different types of Google ads that you can use during your campaign.

Types of Google Ads

There are a variety of different ad campaigns that you can use on Google Ads:

  • Search campaign
  • Shopping campaign
  • Display campaign
  • App campaign
  • Video campaign

We’ll go over each of these Google ad campaigns to show you how they work, and help you decide which type is right for you.

Search campaign

Search campaign ads display as text ads in the search results page.

For example, are the Search campaign ads for the keyword “iphones”

Google Ads Quality Score

These ads are very common. You’ve probably run across many in your own Google searches. They appear on the SERP with the black “Ad” icon next to the URL.

However, there are plenty of other ads that appear when you search. Another of the many options is for your ad to appear in Google Shopping.

Shopping campaign

By using a Google Ads shopping campaign, you can promote your products while displaying images in order to grab the attention of users.

Here is an example using the same search for iphones:

Google ad quality score

They can also appear in the Google Shopping tab:

google ad campaign

If your business sells physical products, shopping campaign Google Ads are a great way to generate leads by showing your products directly to consumers.

Display campaign

The Display Network uses Google’s numerous website partners to feature your ad on several websites all over the internet.

There are several different ways that these ads can appear. Your ads can appear on third-party websites:

google display network

Your ads can also display before a YouTube video:

ads quality score

You can also choose to advertise on Gmail:

search engine ad campaign

Lastly, you can choose to have your ads appear in third-party apps on the Google app network:

in-app ad

A huge benefit of using the Display Network is the ad reach.

Over two million websites are partnered with Google. These are popular sites that reach over 90% of the users on the Internet. That’s a lot of potential eyeballs on your ads!

The type of ads you choose are also very flexible in terms of style. You can display your ads in a variety of ways such as text, image, gif, or video.

One thing that’s very important to keep in mind when using these sites: your ads may end up on websites you don’t want them on, or before videos that you don’t want associated with your brand.

However, if you are careful about where your ads are being placed, the Display Network can be a fantastic tool in increasing leads.

App campaign

App campaigns are included in the Display Network, and can be used for targeted campaigns.

This ad works by taking the text and visual components such as a photo that you want your ad to include, and allowing Google to essentially make the ad for you so that it is compatible with various apps in their network.

Google’s algorithm will test different combinations for the look of your ad and choose the one that performs the best more often.

Video campaign

As we covered in Display Network ads, Google offers video ads that roll before YouTube videos.

Google Ads offers this option as a standalone campaign if you so choose.

This is a great way to test out video ads.

Video campaign ads come in a variety of forms. You can choose skippable or un-skippable ads.

There are also discovery ads, which will display on the search results page when using specific keywords.

discovery ads

 

Now that we’ve gone over the different types of advertising you can do with Google. Let’s take a look at the cost.

Cost of Advertising on Google

In the United States, the average cost-per-click with Google Ads is typically $1 and $2.

This can, however, depend on several factors. This includes the amount you are bidding, and the quality of your website.

With this being the case, you can expect the cost to vary from ad to ad.

In order to fully understand how much Google advertising will cost your business, you’ll want to get to know the Ad Auction system.

When a keyword you are targeting is searched by a user, Google will automatically go into auction mode behind the scenes.

It compares your Ad Rank with that of other marketers who are using that target keyword.

This doesn’t mean the one with the biggest budget wins. Google favors websites that help users most. A high Quality Score will help you rank at the top.

This allows smaller businesses to compete with Fortune 500 businesses because it all depends on quality.

So far we’ve covered what Google Ads are, how much they cost, and what kind of ads you can make. Now let’s go over how you can optimize your ads using Google Keyword Planner.

Using Google Keyword Planner

Google Keyword Planner is a free keyword tool from Google to help you choose which keywords your business’ ads should target.

You’ll search for words and phrases that are related to your business using the keyword planner. Google will then display information on these keywords such as how often it is used in a search.

Google will also give you the suggested bid amount for that specific keyword, as well as how much competition there is in using that keyword.

This will allow you to make better decisions when it comes to targeting your Google Ads campaign.

Here’s what to do to get started:

Go to Keyword Planner

First, you’ll want to go to the Google Keyword Planner site and click on “Go to Keyword Planner”.

advertise on google

Set up an account

While signed in to your Google account, click “New Google Ads Account” located in the middle of the page

new Google Ads account

Next, you’ll confirm your business information is complete and accurate by choosing your country, time zone, and currency. Then click “Submit”

The Easy Way to Advertise on Google

Google offers many ways in which you can advertise on their platform.

If this is your first rodeo, we’ll walk you through the process step-by-step in setting up Google Ads. If you’re a seasoned veteran and already have a Google Ads account, you may want to skip to the next section.

First things first. To start using Google Ads, you need a Google account for your brand or business.

If you don’t have one yet, don’t worry! You can create an account here.

Once your account is set up, you can move on to advertising on Google.

Set a goal

Your first step is to go to the Google Ads homepage. Once there, click “Start Now”.

advertising platform

You’ll be sent to your dashboard, where you’ll click on “ + New Campaign”

Next you’ll choose the goal of your campaign. This will allow Google to know the type of audience you wish to target, as well as how they’ll get your bid money.

There are several goals which you can choose from. The goal you choose will help decide the right type of ads for you.

Pro tip: Be specific with your goals. If your goal is vague, you may end up wasting time and money. Being specific really helps to create a profitable campaign.

The best goals are set using the SMART objectives.

SMART goals will allow your business to get the most out of your Google Ads objectives.

Provide Your Business Name, and Select Keywords

After your goals are set, click “Next”.

You’ll then be prompted to provide a business name.

your business name

After adding your business name, click “Next” where you will provide a URL for where users who click your ads will be taken.

your website

On the following page, you’ll choose the keyword themes that best match your ad and your brand. This is where the work you did with Google Keyword Planner will come in handy.

keyword planner

Once you’ve chosen your keywords, click “Next”.

Choosing Your Target Audience

Next you’ll choose where your ads will be targeted. This can be set to show when a user is near a specific location, or it can be a little broader by choosing zip codes, cities, etc.

target location

After choosing the target region, you’ll click “Next”.

Making an Ad

Next you will create the ad itself.

You’ll make the ad’s headline as well as the description. You’ll be able to test it out by viewing it in the preview box on the right side as you go along.

Google will also offer tips and samples to help you with some inspiration if need be.

The #1 thing to keep in mind when writing your ads, is your audience.

There’s no trick or secret when it comes to creating ad copy that captures a user’s attention. It’s all based on the market you are targeting. More than likely you know why people want your product or service, so use those pain points to write your ad copy. It’s that simple!

Set up Billing

Next you’ll set up your billing. Enter in all of your billing information as well as any promotional codes you may have, then click “Submit”.

google ads billing setup

There you have it! You created your first Google Ad!

Now you’ll learn how to track your Google Ads with Google Analytics.

Google Ads for Advanced Marketers

This is a more hands on approach to creating Google Ads.

Please note: For this method, we are assuming that your payment info has already been entered into Google Ads. If this isn’t the case, make sure to go to the Google Ads dashboard, and click “Tools & Settings”.

Under “Billing” select “Settings”. From there you’ll be able to set up your payment info.

Set Your Goal

From the Google Ads homepage, click “Start Now”.

display network

This should send you to your dashboard, where you’ll click “ + New Campaign”.

This is where you’ll choose your campaign goal. Choosing a goal will let Google know what audience you want to target, as well as how they will get your bid money.

Once your goal is set, a window will appear where you then select your campaign type. You’ll choose one of the following:

  • Search
  • Display
  • Shopping
  • Video
  • Smart
  • Discovery

The instructions you will follow will depend on what type of Google Ads campaign you choose. Overall the steps will remain the same though.

Once you choose your Google Ads campaign type, you’ll enter the specific information that Google requests, then click “Continue”.

Set up Targeting and Budget

We’ll use the example of setting up a Search campaign for this particular step.

When doing this, you’ll choose the networks where you want your ads to appear.

You’ll choose the specific location, languages, and other demographic audience information for who your ads will appear to.

While you may think that the larger your radius is, the more business you will get – that isn’t always the case. In actuality, the more specific your targeting is, the more leads and conversions you will garner with your ads.

Obviously it would make sense to have your ad target a small area if your business is located in one city. If you have a brick and mortar store in Seattle, you probably don’t want to include Phoenix in your target.

Once setting your targets, you’ll put in your budget for your ad campaign.

Select the type of bidding you want to target, as well as your budget.

Lastly, you’ll include Ad extensions. There are additional pieces of ad copy you can add on to your ads to enhance them.

When you are satisfied with how everything is set, click “Save and Continue”.

Setting up an Ad Group

An ad group is a set of ads that you have created that have common themes and targets. For example, if you have multiple ads that target prom dresses, you may want to create a separate ad group labeled “Prom”.

You’ll add your keywords, or enter in your URL and Google will provide them for you. Once the keywords have been added for this group, you’ll click “Save and Continue”.

4. Create Your Ad

Next you’ll create your ad.

In the next section, you’ll create the ad’s headline and description. You’ll see a preview box on the right side which will allow you to see what your ad will look like for mobile, desktop, and display ads.

After you’ve created your ad and you’re satisfied with how it looks, you’ll click “Done and Create Next Ad” if you want to add another ad to the group, otherwise click “Done”.

5. Review and Publish

Next you’ll review your Google ads campaign. Make sure you take a look at everything thoroughly and edit anything that isn’t quite right. Once you’re happy with how everything looks, click “Publish”.

There you go! Your Google Ads campaign is created!

Tracking your Google Ads with Google Analytics

Make sure you are tracking and analyzing the data from your Google Ads campaign.

This will allow you to learn what is working at what isn’t, and allow you to make changes, even small ones, to your future Google Ads campaigns so each performs better than the last.

In order to do this, you’ll want to link your Google Ads with Google Analytics.

Once you have Google Analytics, you’ll link the two services by following these simple steps from Google:

  1. Go to your Google Ads account.
  2. Click the Tools menu.
  3. Click Linked accounts under Setup.
  4. Click Details under Google Analytics.
  5. You can now view the Google Analytics websites you can access. Click Set up link on the website you want to link to Google Ads.
  6. From here, you’ll be able to link the Google Analytics view of your website.
  7. Click Save.

This will allow you to view vital metrics like click data and costs for your Google Ads on Analytics. This will help you to determine how future ads should be targeted and budgeted based on performance for current campaigns.

Once reviewing you’ll want to set up tags to track the conversions you gain from your ads.

Final Tips for Running Successful Google Ads Campaigns

Get Your Landing Page in Order

Once users click your ads, they will be directed to your landing page. First impressions truly are the most important when it comes to marketing, so make sure you get your landing page right.

You’ll want your landing page to be inviting and have a clear call to action, while at the same time keeping the entire page scannable. This means keeping the goal obvious without large sections of text.

Is your goal to have your visitor sign up for your newsletter? Make sure that the signup box is the focal point of the landing page.

Are you looking to increase sales? Include reviews, and direct links to purchase your products or services on your landing pages.

Make an Eye Catching Headline

One of the most, if not THE most important part of your Google ad, is the headline.

It’s the first thing that users see, and it gives your ads a chance to stand out from the crowd.

That’s why it’s so important to get it right.

One tip for writing headline for ads: Avoid ads with clickbait headlines! You know the ones we’re talking about. It makes your brand untrustworthy right off the bat.

We’re always here to help you when it comes to Google ads, or advertising on any other platform. Feel free to connect with us so we can help you reach your goals!

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