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The Basics of Google Ads: How It Works and How to Use It to Advertise Your Business

April 4, 2018 at 9:00 AM

Google Ads is an online advertising platform where advertisers pay to display search ads, banners, rich media, product listings, and video content within Google and its network of millions of partner sites and apps.

Google Ads is one of the most popular platforms among advertisers, as it allows advertisers to reach users with intent (those looking for a specific service or product), as well as being a powerful tool to raise brand awareness through its various options of ad formats and placements. Because Google Ads is a "monster" tool, with endless setup options, managing an account can be complicated and, oftentimes, a full-time job—which is why we wanted to offer a helping hand with a new educational series on Google Ads.

How does Ads work?

Google Ads relies mainly on keywords to display ads—keywords are the words or sentences a user types in when searching for something on Google. Keyword prices vary based upon competition and search volume.

Its most common ad format is Search Ads, which are ads composed of text only—two headlines, a description, and an outbound link. These ads are served to the locations you select and the audience can be narrowed down by demographics, such as age and gender. Search ads appear in Google's search results are triggered when a user’s search terms match the keywords and the targeting used for the ad.

google adwords search ads


Display Ads are also very popular among advertisers. This format can be used for brand awareness, audience retargeting, and even for generating clicks, sales and leads. Ads display ads appear on over two million websites in the Google Display Network and in over 650,000 apps. Format options include dynamic text ads and banner ads.

google adwords display ads banner 2

Google ads is a great tool for desktop and mobile alike. As the number of people favoring the use of mobiles over other devices grows—just between 2016 and 2017 mobile visits grew from 57% to 63% and more than half of Google’s searches are done from mobile devices—Google is now moving towards mobile-first indexing. So, don't overlook the power of mobile when adverting your business online. 

Using the right keywords

Keywords are extremely important in Google's universe. The right set of keywords can determine your ad cost and whether your ads are shown. Keywords prices are measured by cost per click (or CPC). CPC amounts vary based on how much other advertisers using those same keywords are willing to pay for them.

Your bidding affects the position your ads appear on Google's search results pages. Generally, the more you're willing to pay for a click, the more prominently your ad will appear, but your ad copy and the quality of your landing page can also impact when your ad is served and where it's placed.


Learn more about keywords and how to pick the right ones for your business segment.


ads overwhelming


How important is my ad copy?

Your ad copy serves two purposes, and the second is not at all obvious. The first is what catches the eye of whomever is searching for what you are offering. If the copy doesn’t resonate, your ad is unlikely to be clicked. The second purpose of your ad copy is to be relevant to your landing page (the page linked to your ad).

Your landing page content affects Google’s internal ranking of how relevant your ad is to what someone is searching for. Google likes to reward highly relevant ads with more prominent placements, so if your ad copy and landing page is more relevant than other ads for the same keywords, your ad may be boosted to the top position, even if you don't have the highest bid.

google ads ad copy


More tips on creating successful Google ads


Measuring your ads and campaigns

There are many aspects that involve the measuring and success of an ad campaign on Google Ads. These are some of the most common terms for new advertisers:

  • Impressions - number of times someone saw your ad
  • Clicks - number of times someone clicked on your ad (they engaged)
  • CPC or Cost Per Click - the average amount of money a click on the ad costs
  • CPM or Cost Per Mille (one thousand views) - a way to bid where you pay per one thousand views (impressions) on the Google Display Network.
  • CTR  or Click-Through Rate - number of clicks divided by the number of impressions. This is a measure of the general effectiveness of your ad.

How can I tell if my ad is bringing in business?

Conversion tracking is one of the best ways to measure the success of your campaign. The number of times someone clicking on your ad resulted in them taking some measurable action, such as filling out a form or completing a sale is one of the easiest ways to check your ad’s performance.

If your goal is to raise awareness, you can measure your campaign results through the number of impressions they generate or the click-through-rate. Google considers any ad with a CTR of 2%+ a good-performing ad. While you can look at the number of clicks as an expression of clear interest in your business, you can’t tell from that alone if the clicks brought you value. To do that, there are a few options:

  • Have your ad link to a unique landing page with a specific call to action, such as
    • a coupon whose usage you can track in the store.
    • a form that will gather an email address that you can later use to retarget with special offers. You can also encourage users to fill out a from to get a coupon that you can then track—they get a discount and you get an email address. in-win!
  • You can also use analytics platforms like Google Analytics to track the referral source of your website traffic and then measure those conversions

What else do I need to know about creating ads in Google Ads?

There are several additional important factors for creating a successful ad campaign through Google Ads. Keyword matching options, ad groups, scheduling, bid strategies, ad extensions, placements, just to name a few. Setting your ads up the right way can be confusing and difficult; but fortunately, there are different tools and platforms you can use instead. Spatially Ads, for example, simplifies it down to the essentials and provides a layer of location intelligence for your business address that isn’t available anywhere else, targeting your most probable customers by analyzing offline behaviors .

Start advertising

Explore further:

Calculating Your Advertising Budget: A First-Time Advertiser's Guide

10 Reasons Why Google Rejected Your Ad

Facebook Ads or Google Ads: Where Should You Be Advertising?

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