Google Ads (An Overview Of How Google Ads Work)
Google Ads – Did you know that internet users use google to search over 3.5 billion times a day?
Each search provides an opportunity for your brand to appear in front of more users.
The more you rank or appear to many users on google the better your chances of increasing conversions, leads, and sales.
Google Ads do not actually pay off. Instead they just make Google money. You may think that google only displays advertisement (ads) on search results pages. But it does much more than that. Let’s have a look at how google makes money out of your searches.
First let’s start with a basic example. Say I search for ‘Cannabis’ on Google. Now imagine that there are a lot of different Cannabis companies running their own websites in the top 10 search results page, some offering free samples and others selling expensive products. Let’s say each company gets paid $0.01 per click on their ad. That means if there are 100 ads on my search results page, then each website will get $10 for being displayed.
However, Google takes an additional 20 percent cut of every single transaction. So the total amount that any given company will receive for showing their ads is $0.11. And that’s assuming that every single person clicks on the display ad! If 10 people click on the same link, then only $0.11 goes to that company. Then Google keeps 70 percent of that dollar. In this way, Google makes money off your searches even though they technically don’t pay anything out to the website owners.
Now let’s take a second example. Say a company wants to promote their brand name on Google. They could bid on bids for keywords that relate to their business. But again, the site owner still doesn’t actually get paid. Here is where Google takes advantage of its monopoly power. The site owners put up an advert with their content, hoping that users will click and visit their website. But what if Google decides not to show the advert? Well now the user never sees the advert, which means no revenue for the advertiser. So in order to guarantee that the advert appears on the first page of the search results, Google takes 30 percent of the advertiser’s budget before paying out to the website owner. This is called AdWords bidding.
Now, what are google ads, and how beneficial is it to your business??
What Is Google Ads?
Google Ads is an advertising platform that helps businesses advertise on the internet. Google Ads works by placing ads on websites that are relevant to the keywords that your business is targeting. This means that you don’t have to spend any money to place ads on Google, and you can even track the effectiveness of your ads.
Benefits Of Google Ads To Your Business
Google Ads allows you to create online ads that reach people when they are interested in the products and services you offer.
Google Ads is a product that you can use to promote your business, help sell products or services, raise awareness, and increase traffic to your website.
With a Google Ads account, you can create and manage your ad campaign at any time, including your ad text, settings, and budget. There is no minimum spending commitment, and you set and control your own budget. You choose where your ad appears, set a budget that’s comfortable for you, and easily measure the impact of your ad.
With or without a good SEO, one is capable of ranking on top of search engines when a user inputs a keyword in line with your business.
How Google Ads Work
Whenever google ad (Adwords) is mentioned, two parties must come to mind; Publishers and Advertisers.
Let’s quickly brush through who these parties are and their basic roles respectively before we dig more into how google ads work…
Publishers are the content creators who own websites, apps, YouTube channels, and google affiliated platforms that have been approved into the Google Adsense program (Monetized platforms).
Apart from search engine ads, google place advertisement (ads) on the publisher’s platforms, where google pay them 55% of the total amount paid by an advertiser anytime an ad is clicked on a respective publisher’s forum. Click here to read more about google Adsense and how publishers make money off it.
People and business owners wanting to get leads, conversions and sales from their products and services pay an amount to Google in order to get their products and services appear on top of search engine results page (SERP).
Let’s dig into details how google ads work!
Google Ads operates under a pay-per-click (PPC) model. That means marketers target a specific keyword on Google and make bids on the keyword — competing with others also targeting the keyword.
The bids you make are “maximum bids” — or the maximum you’re willing to pay for an ad.
For example, if your maximum bid is $4 and Google determines that your cost per click is $2, then you get that ad placement! If they determine that it’s more than $4, you do not get the ad placement.
Alternatively, you can set a maximum daily budget for your ad. You’ll never spend more than a specific amount for that ad per day, helping you get a better sense of how much you should budget for your digital ad campaign.
Marketers have three options for their bids:
- Cost-per-click (CPC). How much you pay when a user clicks on your ad.
- Cost-per-mille (CPM). How much you pay per 1000 ad impressions.
- Cost-per-engagement (CPE). How much you pay when a user performs a specific action on your ad (signs up for a list, watch a video, etc).
Google then takes the bid amount and pairs it with an assessment of your ad called a Quality Score. According to Google:
“Quality Score is an estimate of the quality of your ads, keywords, and landing pages. Higher quality ads can lead to lower prices and better ad positions.”
The score number is between 1 and 10 — with 10 being the best score. The higher your score is the better you’ll rank and the less you have to spend converting.
Your Quality Score combined with your bid amount creates your Ad Rank — the position your ad will appear in the search results page.
And when a user sees the ad and clicks on it, the marketer pays a small fee for that click (thus pay-per-click).
The idea is that the more users click on a marketer’s advertisement, the more likely they will accomplish the advertisement’s goals (e.g. become a lead, make a purchase).
Now that you know how Google ads work, let’s take a look at the different types of Google ads you can use for your campaign.
Types Of Google Ads
Google offers different types of ad campaigns. The following are types of google ads.
- Search campaign
- Display campaign
- App campaign
- Video campaign
- Shopping campaign
Now, let’s take a look at each campaign type and how it works.
Search campaign ads appear in the results page of the keyword. Search campaign ads usually appear as text in the search engine results page (SERP).
Below is an example of a “search campaign ad” for mobile phones.
What Is A Display Campaign?
A display campaign is a type of campaign that lets you display ads on websites that people visit as part of their regular browsing.
When you create a display campaign, you can specify which websites you want to target. You can also set a budget and target a specific audience.
Google AdWords will serve your ads to people who are likely to be interested in the products or services that you’re selling.
When you create a display campaign, you can also choose to target specific search terms. This helps you reach people who are searching for information about your products or services.
What Is A Video Ad Campaign?
Video advertising is a type of marketing that uses online video content as a way to promote a product or service. It’s a popular way to reach a wide audience and create a sense of urgency.
There are a few things you need to know before launching a video advertising campaign. First, make sure you have a compelling message to share. Your video should be well-made and interesting to watch.
Second, make sure your video is optimized for search engines. You want people to be able to find your video easily, and you need to make sure your video is listed in the right places.
What Is A Shopping Ad Campaign?
Shopping is one of the most popular activities in the world. There are many different shopping campaigns out there, and each one has its own unique selling points. Some of the most popular shopping campaigns include those from Nike, Adidas, and Coca-Cola. Nike’s campaign is known for its innovative use of graphics and animation, while Adidas’s campaign is known for its high quality sportswear. Coca-Cola’s campaign is known for its catchy jingles and memorable slogans.
Because brand competition is higher, Google adwords has been a great tool to escalate and rank your shop on top of Google search.
Google ads are a great way to get your website or blog noticed. They are a form of online marketing that allow you to place ads on Google.
When someone clicks on an ad, you will earn money (For publishers). You can also use ads to promote your blog or website (Advertisers).
You can target your ads to specific demographics or locations. Google ads are effective because they are targeted and
they allow you to earn money from a wide range of sources.
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