Introduction to AdWords

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Introduction to AdWords

Google AdWords is an advertising element run by Google for displaying ads in the search engine and the advertising network. This element lets you run ads which is focused on keywords with a set budget.

Does Anyone Actually Click on These Ads?

The number of people that click on PPC ads depends on the search query and the intent of the image-30-walteranalyticsperson doing the search. For example, for search queries that are looking for further information such as “digital cameras”, the percentage of people who click on links is likely to be higher as they are researching and are going to look for multiple options.

The percentage of people that click on ads for a specific keyword varies from just five to ten per cent, to over forty per cent. In the past 12-18 months, changes in the Google AdWords interface is likely to lead to higher click through rates, often as users do not necessarily know the difference between the organic and paid search results.

How PPC Advertising Works

PPC advertising works by allowing an organisation to purchase space for their website(s) in a prominent position on the search results. Over the years, PPC ads have become more prominent in the search results, gaining a larger share of clicks from users.

PPC ads are typically made up of a text based ad with a headline, body text, URL, and link to a website. Google AdWords is the prominent PPC service on the Google search engine, and has an algorithm that ranks ads based on the amount they are willing to pay for a click (the bid), and the relevance of the ad to the users query.

PPC ads are a great way of purchasing relevant visitors to a website quickly to test an offer, and often directly buying customers can be profitable when the offer is clear and priced appropriately.

As search has become the dominant way for consumers to find things, and increasingly decisions are based on those links that appear near the top of search engines, hence it’s important to be present and provide a compelling offer to get users to click.


Regular Search Ads

You’re probably most familiar with these ads. What you might not be aware of is how they attain
their ranking order. The order is determined through a combination of two factors: quality score, and bid. Quality score is how often people actually click on the link. This determines if the link is deemed valuable by the audience. This makes it possible for a lower-bidding ad to attain a higher search engine paid rank than a higher-bidding rank if its audience deems it more valuable and clicks on it more often.

Online Shopping Ads

Part of Google’s advertising approach is to have online stores pay to have listings shown as ads when a relevant search term is entered. Here, in the event that enough partner stores list a certain product – fishing rods – these listing ads will appear first, with usual advertisements appearing underneath as shown.

Note, these are only ads which show up in the search engine itself. This does not include the extent of Google’s advertising network options, including display ads, search partner website ads, and YouTube.

Ad Targeting Possibilities – How This Ties in with Analytics and Personalisation

There is an overlap here with the remarketing module of the Marketing Implementation and Strategy section. With Pay per Click Advertising targeting, it is possible to target your ads based on an extensive spread of characteristics, allowing you to target very specific niches. We went through them previously, but here they are again, so it’s a little clearer:


It is possible to advertise to people based on:

  • How long they spent on a specific page
  • Their gender
  • Their interests
  • Which device they have
  • Location
  • and many other characteristics

Remember it’s also possible to advertise to audience segments as previously defined by you. This is where advertising ties in with Google Analytics customisation.

It’s all coming together now.

Remember in Google Analytics customisation, the point is to track the things that matter most, through Events and Goals. Using these Goals, we set up segments of our audience, and people we can advertise to, based on the above list of characteristics. Then we advertise to them, based on which segment we think will convert the highest.

Such a segment can be people who have interacted with your ad or website previously. This is the remarketing aspect.

Then we keep testing it, and refining the campaigns that are active, to optimise them for highest conversions and lowest costs.

These are the possibilities that Pay Per Click advertising provides.

PPC Do’s and Don’ts

  • Make ads relevant
  • Advertise on non-targeted broad keywords
  • Find specific targeted keywords
  • Only have a couple of ads
  • Test ad copy
  • Spend your budget too fast
  • Research competition and the market
  • Not pay attention to your competition
  • Structure the account into logical groups
  • Disregard behaviour when the user comes to your website
  • Start with a small budget and work up
  • Define advertising objectives
  • Define conversions and link them to PPC
  • Pay attention to what happens once the user comes to your website

Testing is Important for AdWords! Here’s why…

AdWords provides a flexible interface to test ads, keywords, bidding strategies, ad copy, and all combinations of these elements. Testing is important, because without it, improvement is impossible, as is the case with any process. With a rich array of Analytics tools available to image-32-walteranalyticsdetermine performance, testing allows you to consistently improve your performance, reduce your cost, and increase your ROI. In this context, ‘testing’ refers to the consistent evaluation of different elements of the advertisement with regards to achieving the desired outcome. In other words, we run different combinations of elements of the ad at the same time to see which one works best.

Improving the performance of your advertising increases your Return on Investment (ROI) and lowers your Cost Per Acquisition (CPA). For example, our client – an insurance broker – is paying $5 per click to have a visitor come to his website. With a 5% conversion: lead rate, our CPA is $100. Our client has a target CPA of $75, so we have some work to do to achieve this $75 figure.

By reducing the cost per click to $3.50 through ad testing and keyword optimisation, we are able to get the CPA down to $70, which is within the clients figure. We can also undertake testing on the website and improve the conversion rate by analysing the Analytics and undertaking A/B testing.

Possibilities of Testing

This includes targeting, timing and segmentation

AdWords testing focuses on the ad copy and specific keyword targeting. On the search network, there are millions of keyword possibilities. It is therefore essential to test and determine the keywords most relevant to your business. The ad copy is the key factor that will determine your Click through rate (CTR), and often if your ad will get shown or not.

A testing and optimisation strategy revolves around the many different elements which comprise an AdWords/PPC campaign. An effective strategy will identify the most responsive market segments, as we have done in the audit section previously, and test the elements of the advertisement on these segments.

This will involve A/B testing and/or multivariate testing, where elements are altered to gauge audience responsiveness. A control is put against an experimental ad on a regular basis. A professional agency will be able to run this process for you, and improve your results over time.

All the previous possibilities of targeting apply here, just as much as they do for the previously discussed advertising methods. It is possible to test elements such as ad copy, headline copy, url included, subheading copy, ad location, target market segment, time of day. By matching these elements through a process of trial and error, the most effective combinations will emerge for each keyword on your list.

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