Google Ads Made Simple
Heard of Google Ads or AdWords but never truly understood what it is?
Heard words like Ad Rank and Ad Position and Quality Score but didn’t know what it is?
Don’t know how people get their ads on the top position of the search engine?
Well, you have come to the right place. Here I’ll each and everything about Google ads, what is it? Where it appears? Why should you try it? How Google ads bidding and auction system work?
What are Google Ads?
Google Ads (previously known as Google AdWords before July 2018) is a platform developed by Google for users to advertise their products, services, and content online.
In Google Ads, advertisers pay to display brief advertising copy, video content, and product listings, within the Google Ad Network to Web users.
Google Ads was first launched in 2000, and it is the primary source of revenue for Google. (Total advertising revenues of USD 95.4 billion in 2017).
The system of Google Ads is based partly on cookies and partly on keywords determined by advertisers.
Google uses these keywords and cookies to place Ad copies on pages where it thinks might be relevant.
Also read: What is SEM? Search Engine Marketing Explained
Pay-per-click
Running your website ads on Google Ads works on a concept called ‘pay-per-click.’
PPC means you don’t have to pay as an advertiser for your ads unless someone clicks on it. When a person clicks on your ad, he’ll be re-directed to your website or specific webpage.
Google charges nothing form advertisers to create ads on Google Ads platform. There is also no limitation on the number of ads an advertiser can create.
When an advertiser creates an ad with specific keywords, Google shows his ads on his SERP or on the google network if someone enters the same or related keyword on Google.
Campaigns
In Google Ads, you can create multiple campaigns and multiple ad groups. This way, it’s easy to manage different campaigns.
Let’s say there are two campaigns one is a text campaign, and the other is a video campaign, the marketer can easily manage separately both campaigns in Google ads.
Within each campaign, the ads and keywords are broken down into ad groups.
A marketer can update his ads anytime whenever he wants to change his ad strategy. He can also update the budget, change content, change ad type, etc.
The great thing about Google Ads is that you are not charged for impressions (number of times it shows the ad).
You only have to pay for those campaigns that result in clicks on your ads.
This doesn’t mean you can only use a Cost-Per-Click or PPC pricing model.
There are other pricing models, too, such as Cost-Per-Acquisition (CPA), Cost-Per-Installation (CPI), Cost-Per-Lead (CPL).
What’s a text ad?
According to Google’s Ads guidelines:
On the Search Network, the text ads are shown above and below Google search results. It has a headline, a display URL, and description text.
Length limits
| Field | Max length |
| Headline 1 | 30 characters |
| Headline 2 | 30 characters |
| Headline 3 | 30 characters |
| Description 1 | 90 characters |
| Description 2 | 90 characters |
| Path (2) | 15 characters each |
Where Google Ads appear?
To understand this first, we need to understand what Google network is:
Google Network is a network of various websites and apps where your ads appear. These include Google websites, Google’s partner websites, and multiple mobile phone apps.
It is divided into groups so that you have control over where you want your Ad to appear
Google Search Network (GSN) – Google search results pages + Google sites like Maps and Shopping + Search Partner Websites
Ads can appear above or below, depending upon the ranking on SERPs.
Google Display Network (GDN) – Google websites like YouTube, Blogger, and Gmail + 2 million partner websites and mobile apps.
On the Google Display Network, text ads, image ads, as well as video ads can appear. People will see your ads when they are browsing on the Google network.
Why you should try Google Ads?
- You can reach new customers and grow your business through it.
- Can set Flexible Budget – Set a budget that is comfortable for you.
- It has advanced targeting options – Choose whom you want to show your ads
- Re-marketing
- There is no minimum spending requirement.
- Measurability – Track the impact of your ad campaigns.
- You can pause or stop an ad campaign at any time.
- Digital Marketing of advertising in India to grow at 32% CAGR to reach Rs 12,046 crore by Dec 2018 and Rs 19,000 crore by 2020.
Also read: Why the Future Scope of Digital Marketing in India is Very Bright?
Understanding Ad Rank and Ad Position
When working with Google Ads, your Ad position refers to where your ad falls among the ads placed around specific search results.
In traditional advertising platforms, the person who pays the most will get the best ad placement. This is not necessarily true in ad placement bidding for search engines.
It involves a combination of different factors to determine Google Ad Rank.
You have to remember that search engines are trying to give the most relevant information they can to their users.
This is the reason why most search engines use custom algorithms to determine ad placement based on factors like relevance, landing page quality, and bid price.
When someone looks for something on Google, it tries to find all the results that match the keyword or keyphrase.
The system ignores irrelevant ads that are targeting, let’s say a different country or different region in the same region. Basically, ads that don’t concern the specific user are ignored.
From what’s left, ads with high Ad Ranking are shown to the user.
Every search might produce different results depending upon the competition during the auction at that time.
Remember, with highly relevant keywords, you can even outrank your competition even when their bids are higher than you.
| Traditional auction | ||
| BID | PAYMENT | |
| Bidder #1 | Rs. 4 | Rs. 4 |
| Bidder #2 | Rs. 3 | Rs. 3 |
| Bidder #3 | Rs. 2 | Rs. 2 |
| Bidder #4 | Rs. 1 | Rs. 1 |
| SECOND PRICE AUCTION | ||
| BID | PAYMENT | |
| Bidder #1 | Rs. 4 | Rs. 3 |
| Bidder #2 | Rs. 3 | Rs. 2 |
| Bidder #3 | Rs. 2 | Rs. 1 |
| Bidder #4 | Rs. 1 | …….. |
The fact that Google only wants to show highly relevant ads to its users.
The ad rank depends upon not only the maximum bid but also various other factors such as quality score.
So, the ad position is determined using their Ad Rank algorithm. Major elements of Ad Rank are:
Ad Rank = f (Max CPC, Quality Score)
If the ad rank is low, the ad may not show up at all, as the algorithm doesn’t consider it relevant to what a user is looking for.
The graphic below may help in making it easier to understand.
| Maximum Bid | Quality score | Format Impact | AD RANK | APPROX. CPC | ||
| Bidder #1 | Rs. 2 | HIGH | HIGH | = | 20 | Rs. 1.73 |
| Bidder #2 | Rs. 3 | HIGH | LOW | = | 18 | Rs. 2.24 |
| Bidder #3 | Rs. 1 | MEDIUM | MEDIUM | = | 8 | Rs. 0.69 |
| Bidder #4 | Rs. 4 | LOW | NO FORMAT | = | 5 | NOT RELEVANT ENOUGH TO RANK |
As you can see, Bidder #2 has a high-quality score, so if he could adjust his ad format or increase his maximum bid, he’ll outrank Bidder #3.
Though increasing his maximum bid will also increase is CPC.
Point to be noted here is that the Ad Rank not fixed, and it can change for every search query.
Some tips to rank your ads at the top
- Adjust your campaigns for Relevance– Keywords, Ads & Landing Page
- Keep keyword list fresh- Use the right keywords to reach your customers. Use the Keyword Planner.
- Keep Bids Competitive– Keep your bids competitive enough to compete with other advertisers
- Call-to-action (CTA)– e.g., ‘Call now’; ‘book an appointment’; ‘ click here to learn more’ etc.
What is a Quality Score?
Quality Score is a rating measurement Google gives keywords based upon:
Click-Through Rate– Strong CTR across keywords (above 1-1.5%)
Relevancy– Uniform relevance from keyword → Ad → landing page
Landing page quality– ROTN: Relevant, Original, Transparent, Navigable (and fast)
The score of 1-10 (1 being poor, 10 being excellent)
Remember
- Actual CPC is what you pay for a click, and Max CPC is the maximum amount you’re going to pay for a click.
- When you have a high Quality Score, you are most likely to pay less than your competition.
- Quality Score is further boosted by the use of ad extensions along with your
- Relevancy is a major factor in winning the auction.
- Standard text ads on the Search Network.
Conclusion
Google Ads, in a way, has transformed how people can connect with potential customers.
Sure, it can be a significant investment both in terms of money, but it gives a better result than other marketing channels in terms of increasing your revenue, sales, and leads.
Also, it’s essential not to forget that it’s possible to run lucrative ad campaigns with low CPCs even on the least of marketing budgets, with the help of a skillful and experienced campaign manager.
After looking at the current business marketing scenario, Google ads are an essential part of the marketing mix.
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