Google AdWords

Google AdWords is a web-based platform that advertisers can use to place targeted online advertising in the form of text ads, banners or product listing ads in the Google advertising network. Today, Google AdWords is the largest online advertising network in the world. The company Google generates its profit almost entirely through Google AdWords.

History and Background

The history of Google AdWords is closely linked to the history of Google. Because just two years after the founding of the search engine Google, the company from Mountain View launched its advertising platform. When Google AdWords was finally launched as a beta version in 2000, the fledgling Google received a lot of criticism for initially promising to remain ad-free. As is well known, it did not stop there. Today, the income from Google AdWords contributes almost exclusively to the high company profits. The extent to which the company’s financial interests are secondary to ethical considerations could also be observed in 2013 when Google even tested the display of advertising banners in the SERP.

Back to the story:

Shortly after the market launch with fewer than 500 advertisers, the AdWords system developed so well that the group was able to end the beta phase and launch an approved version. In the years that followed, Google AdWords was expanded to include other language versions. By 2004 German, Chinese, Spanish and French were added. The number of advertisers using Google AdWords has increased exponentially, as has advertising revenue.

In 2006, Google AdWords switched its API usage mode to a paid model. At the same time, the official AdWords blog was set up. It still calls itself “Inside AdWords”.

A milestone in the development of the platform was the introduction of ads in 2008 that could be specifically targeted at devices such as Apple’s iPhone. In the same year, Google also adjusted its advertising and quality guidelines for ad copy and keywords.

Four years later, YouTube was also integrated into the large advertising network. This move now allowed advertisers to run video ads as well. Also in 2012, Google expanded the targeting options for AdWords.

The last major development step for the time being was the product listing ads introduced in 2013. Since then, among other things, listing on Google Shopping has been subject to a fee for e-commerce retailers. At the same time, the Goole Merchant Center was given a central function in managing the product catalogue for the PLA, which is now controlled via the AdWords system.

The continuous expansion of the company portfolio suggests that Google AdWords will undergo further important adjustments in the coming years. For example, it can be assumed that it will also be possible to run TV commercials via Google TV or other cross-channel advertising.

Innovations 2018

At the beginning of 2018, Google announced that it would no longer continue to use the review extensions. However, using these extensions was rather difficult for advertisers anyway. The original approach of using the review extensions to help businesses by pulling in reviews from third parties didn’t work properly as the review approval process was slow and sometimes long.

Another innovation of 2018 concerns remarketing ads, some of which can now be muted for users. Advertisers who act particularly aggressively perceive disadvantages for their business model as a result of this measure. However, Google does not want to fundamentally prevent remarketing but aims to apply frequency capping more consistently so that users do not have to access the new feature in the first place.
Google’s Keyword Planner is also new. It comes optically changed but also shows practical benefits through more intuitive use and the display of important information.

Functionality

Google aligned the AdWords platform to the bidding process, which is usually based on the CPC method. This means that the advertiser places a bid on a specific keyword that a user types in via Google search. He has stored an ad text or a banner that matches this keyword. With his offer, the advertiser competes with other bids for this keyword.

Finally, Google controls the ads according to various criteria and takes various factors into account. In principle, a high click bid usually has a higher chance of being placed prominently in the advertising space next to, above and below the organic search hits.

The actual ad position for a given keyword can depend on the following factors:

• Amount of the click bid or click price: Depending on the industry, the click prices for keywords can be between 10 cents and 10 EUR.

• The quality factor of the keyword: With the help of the quality factor, a statement is made as to how relevant the stored keyword is to the target page. In addition, the Google system analyzes the expected click rate as well as the landing page experience. Accordingly, three factors determine the quality factor.

• Competition: The more competitors bid on a relevant keyword, the higher the click price.

• History of the AdWords account: When managing the AdWords account, the history can also be included in the price determination of the keywords. For example, accounts whose keyword lists are never updated and whose ad groups are not optimized are usually at a disadvantage.

• Addressing the target group: The click price can also vary due to targeting options and, for example, decrease if the keyword is to trigger an ad placement as widely and nationally as possible.

• Type of ad: If display advertising is controlled via keywords, the click price can be higher than with purely text-based ad placement.

Setting up an ads account

An account for advertising with Google AdWords usually has a clear hierarchy. At the top level, campaigns are initially created. Here, advertisers have the option of setting the daily budget, alignment or targeting. Other switching methods can also be set up. Multiple campaigns can be created per AdWords account.

A campaign itself consists of ad groups for which relevant keywords are ultimately stored in the system.

It is important that the campaign budget can only be set via the campaign settings itself. If only certain products are to be advertised in a targeted manner, it is usually worth creating several campaigns for better budget allocation.

It is also advisable to use the structure of the advertised online shop or info page as a guide when creating the campaign.

The Google AdWords Editor is used to manage and organize AdWords campaigns offline.

Possible forms of advertising

Google Adwords offers advertisers various forms of ads that can be tailored to their marketing efforts. All ads are checked by the system before they are published. These forms of advertising are briefly outlined here:

• Text-based ads: These two-line ads are the classic form of advertising with Google AdWords. They consist of a title, an ad text and a displayed link. The title has 25 characters, the ad text has a total of 70 characters (evenly distributed over two lines) and the link that is displayed has 35 characters. Special characters may not be used in the ad text. Exclamation or question marks can only appear once.

Text ads placed through AdWords appear next to, above, or below the organic search hits on Google, above Google image search, and on publisher websites from the Google AdSense network.

• Ad banners: These image ads may be served on the Google advertising network and will appear on partner sites that have signed up for Google AdSense. Permitted file formats are GIF or Flash files. The banners can be created either with your tools or with the help of the AdWords tool.

• Video ads: Advertisers can use their video clips or YouTube films to advertise on YouTube or in individual clips or channels.

• Product listing ads: These are theoretically classic image ads for products. Such an ad consists of a product image, product title, price and possibly a short advertising slogan or reference. What is new about this is that the adjustment of this information does not take place via the ad itself, but must be made in the product lists that the advertiser uploads to the Google Merchant Center. The AdWords account is only used to determine which product groups or which products should be displayed.

• Dynamic Search Ads: These search ads are not pre-determined and written, but dynamically created by the AdWords system. The ads are based on the content of the advertiser’s website.

• Click-to-call: This option offers users the opportunity to start a conversation with the company with just one click. For text ads, for example, the desired target phone number can be added.

Back in 2017, Google introduced three new formats to the AdSense network that were designed to make ads “highly customizable” visually. The new formats are called “in-feed ads”, “in-article ads” and “matched content banners”. in terms of title, image or description.

In mid-2018, Google changed “AdWords” to “Google Ads”, and the logo was also redesigned. The background is Google’s claim to present the entire range of advertising options, i.e. Google.com, Google Maps, YouTube and others. The product itself should not be changed, but “smart campaigns” were introduced especially for smaller companies. In the course of this, the use of artificial intelligence (AI) should also play a greater role in the future.

Promoted Products

Special country-specific regulations apply to advertising with Google AdWords. For example, no weapons, tobacco or intoxicants may be advertised via the AdWords platform. There are also restrictions on adult-only products and alcohol.

Stricter restrictions also apply to online pharmacies, which, for example, must first submit their approval to Google before they can place ads for medicines after a review. Some of the strict guidelines have a very practical background. For example, in 2011, Google was fined half a billion dollars because the company allowed Canadian pharmacies to run ads that weren’t allowed in the US.

All information about the Google advertising guidelines can be found here.

There are also strict restrictions on the use of brand names. Anyone who still wants to place ads and use the brand must apply for an exemption and obtain permission to use the brand from the brand owner. The application form is here.

Not using branded terms can have a detrimental effect on ad placement and result in vastly higher click prices.

Example:

How should I design a text ad for Apple’s iPhone that doesn’t use the trademarked terms “Apple” or “iPhone”?

Billing Modes

As with most SEA campaigns, the most widely used billing method for Google AdWords is the CPC. However, depending on the campaign type and orientation, other billing modes are also possible:

• CPA: The prerequisite for this billing method is that the so-called conversion tracking tool has been set up. After that, a separate value can be set for each ad group, either as the highest possible CPA or target CPA, based on which the campaign budget is then automatically exhausted by Google. However, a mixed form is also possible.

• CPM: the classic billing method for banner advertising is possible with Google display or video ads.

• CPC: Showing the ad is free, but each click on the ad costs money.
• CPV: The same principle applies here as with CPC, with the difference that not clicks but video runs cost money.

The advertising customer then pays his bill either when a predetermined amount has been reached or as a flat monthly fee.

Keyword Options

Three different options can be set for the keywords:

• Exactly right: The searcher must enter the keyword exactly as it was stored for the ad to be activated.

• largely appropriate: With this placement method, modified word forms are also used, e.g. by stemming, to trigger the placement of the text ad.

• matching word group: Ads are also placed if the keyword appears within a larger word group.

In each ad group, advertisers can also work with negative keywords, which are not taken into account when ads are served. This can be important, for example, if a keyword has the “phrase match” option selected, but the advertiser does not want their ads to be displayed when the keyword and other brands are entered. In the campaign settings, you can also specify whether related terms and incorrect spellings should also be taken into account.

Placeholders are also helpful when placing ads. Placeholders can be built into the ad texts and titles. The corresponding keyword is then used for them when the ad is placed. The use of placeholders is particularly recommended for campaigns with large keyword sets.

Using the example of the combination “SEO services”:

• Book {keyword: Standard}: The keyword is always written in lowercase.

So: book seo services

• Book {Keyword: Standard }: Then only the first letter of the first word is capitalized.

So: Book Seo services

• Book {KeyWord: Standard } or Book {KEYWORD: Standard}: Then the initials are always capitalized.

So: Book Seo services

• Book {KEYWord: Default}: Then the first word will appear in upper case and the second will be in upper case.

So: book SEO services

• Book {KeyWORD: Default}: Then the first word will be capitalized and the second will be in small caps.

So: Book Seo SERVICES

By using placeholders, accents can be set in the ad texts and titles.

Targeting with Google AdWords

The AdWords system also allows for differentiated targeting. Since 2013, this can also be used independently of automatic keyword and ad options.

The following targeting options are possible:

• Regions: With this option, all ads can be delivered worldwide or only regionally.

• Languages: This choice allows AdWords ads to be limited to specific language regions.

• Devices: In principle, text or display ads can be targeted for mobile devices, desktops or both.

• Age groups: Also align the display with age groups.

• Times of day: All displays can be limited or expanded to days and individual times of the day.

• Placements: Here, certain websites or apps from the Google advertising network can be specifically selected for display ads.

• Interest Groups: Display ads can also be targeted based on user interests. Google then automatically determines suitable placements.

• Affinity categories: Google summarizes possible topic areas that can be linked to the main topic here. Here, too, the selection of the corresponding placements takes place automatically.

With new targeting strategies that are primarily based on user behaviour, Google offers a sensible alternative to conventional keyword strategies. “Similar Audiences” and “In-Market Audiences” can also be used to reach users who have not heard from the company before. “Customer Match” basically works like analogue marketing, AdWords wants to help reduce wastage with the help of appropriate tools and create the opportunity to find the right target group for every company.

Retargeting occupies a special position within Google AdWords, as this requires a link to the Google Analytics account and an adjustment to the tracking code. After that, the relevant goals for retargeting are stored in the Analytics account, which can then be accessed in the AdWords account for retargeting campaigns. RLSA can also be used for retargeting.

Google AdWords Editor

The Google AdWords Editor enables advertisers to edit and manage campaigns and ad groups as well as complete keyword lists on the desktop. Editing and tweaking can be done offline, after which all changes will be uploaded to the appropriate account. The benefit of using the editor is that it can be used to edit and oversee many different accounts.

More tools

• Display Planner: This tool helps with the planning and creation of banner ads.

• Keyword Planner: This tool offers the possibility to identify new keywords and ad groups. In addition, estimates of costs and traffic can be obtained.

• Conversion Optimiser: If conversion tracking has been previously activated by advertisers and the AdWords system has collected enough data, campaigns can be managed using the Conversion Optimiser. Google then serves ads based on your average CPA or a target CPA.

Linking to Google Analytics and the Google Merchant Center

If you use Google AdWords, you should link your Google Analytics account to it. This offers the advantage, among other things, that AdWords campaigns can also be evaluated with analytics. Analytics can also be used to define retargeting goals.

The use of PLA is only possible through the link with the Merchant Center.

Benefits of Google AdWords

Anyone who knows how to use the “Google AdWords” system can benefit from many advantages. Online advertising can be set up and started relatively quickly using the program. In addition, campaigns can be controlled by the user themselves, which means they can be paused or started. This offers advertisers a high degree of flexibility when placing ads. In addition, sensible cost control is possible and there are numerous optimization options to reduce advertising costs in the long term.

For young online shops that still receive little organic search traffic, Google AdWords is a kind of “jump start” to get visitors at all.

For agencies, Google AdWords is a great way to excel. Google offers free Google AdWords certifications for this. The advantage of being a partner is that several customers’ AdWords accounts can be managed via a central “customer centre. In addition, reports for evaluation can also be created via the customer centre.

Here are the main ones summarized:

• Reach relevant users

Search engine advertising can be used to reach users who are specifically looking for a product.

• cost control

With Google AdWords, a maximum budget can be set that must not be exceeded. If the budget is exhausted, ads will no longer appear.

• Transparent evaluations

Extensive reporting on the performance of the ads placed provides a good basis for analysis and optimization.

Google has a very large network of partners (see also Google AdSense). It can be advantageous for an advertiser to also make use of this channel. In principle, Google AdWords can place ads in three areas:

• Directly on Google in the search results
• On the Google Display Network (GDN)
• With search partners as placements

Click Fraud

Google AdWords campaigns can be manipulated by third parties through click fraud. Here, for example, automatically generated clicks on the advertisement are used, behind which there is no interested user. As a result, the advertiser’s daily, weekly or monthly budget is reached more quickly and the advertisement is no longer displayed from that point onwards. Due to the small number of seriously interested visitors, the ROI (return on investment) of the campaign is also reduced.

Benefits for SEO

Google AdWords are not a relevant criterion for a good Google ranking. Google also repeatedly asserts that there is no connection between good rankings and the use of AdWords.

However, an indirect effect can theoretically be determined. The more traffic that comes through AdWords, the more data on visitor behaviour Google also receives. It doesn’t matter whether visitors get to the site via AdWords or organic search hits. For example, if visitors use Google AdWords to keep the CTR or bounce rate low, this gives Google indirect information about the quality of the site. Accordingly, Google AdWords can probably have a supporting effect on the evaluation of a website by search engines. A prerequisite for this would of course be successful AdWords campaigns.

Massive traffic generated by AdWords can also strengthen the brand, in this case, the name of an online shop or website. This can lead to an increase in the number of direct type-ins and thus also in trust. In the second step, the increased awareness offers the chance that the number of external links to the website will also increase naturally.