Google Ads 101: The Basics of Google Ads Marketing

Let's open the black box and shed some light on the basics of using Google Ads to promote your business.

If you're a non-profit company, we'd recommend that you read this article first on Google Ad Grants!

The main three Google Ads campaign types

Google Ads is a complex Marketing Platform with its origins in the 2000s, that has since grown into what brings Google the majority of its revenue and can be divided into 3 major campaign categories: 

  1. Search Ads
  2. Display Network Ads
  3. YouTube Ads

There are other campaign categories, such as Apps, Shopping, Discovery, Smart, Performance Max, and Hotel Ads that I won’t cover in this article. In order to understand Google Ads, I recommend that you start by wrapping your head around these three first. 

Let’s jump straight into the first one. Google Ads was originally called ‘Google AdWords’, as it consisted of Google Search Ads only, which were made up of (you might have guessed it!) words that showed up on the Google Search Engine Results Page (SERP). Today Google Search Ads are still the most prominent option to run ads with Google. 

Google Search Ads

These are the ads we have all seen, at the very top of the Google Search engine! There are four slots up for grabs at the very top (and bottom) of every Search Engine Results Page. 

Quick Overview of Search Ads: 

What they look like: Text

Where they show: Google Search Engine Results Page (SERP)

How targeting works: Bidding on keywords

How to pay: Cost-per-acquisition, return-on-ad-spend (ROAS), cost-per-click (CPC), cost-per-click (CPC) with impression share

Search Ads in detail with example:

Let’s go through an example to bring some context into this. Imagine you are a dog sledding company in Norway. Your customer may search for “dog sledding in norway”. If this is a search term you’d find valuable then you have the option to ‘bid’ on it as a keyword. Bidding on these keywords will allow you to compete in an auction with the other companies that are also bidding on the same keyword. This is called an open auction. During this live auction the system decides in a split second which company will show up (and in which position on the SERP) for the discussed keyword. The winner will take position 1 (which is most sought after, as the majority of people tend to click on the top ad slots). 

Once the Google Search Ads winners have been determined by the open auction, they get to show their text ads, which contain a headline each and several lines of description. Some of them might feature some images that form part of the optional but recommended text ad extensions.

In the screenshot above, you can see that someone searched for “dog sledding in norway” and three companies showed up. All of them have the small text on the top left that identifies them as an “Ad” and means it’s been paid for. Here you can clearly see the ranking of the three companies, and getyourguide was the winner of this specific open auction, placing the company in the top ad slot. 

When a potential customer now clicks on the dog sledding company’s text ad, they are directed to the company’s landing page. This will count as a click and is therefore chargeable. 

Google was the first company to charge customers per click, rather than per view or impression. When this new system was introduced in the 2000’s everyone in the industry thought Google was making a grave mistake, but in the end it was a win-win. It meant that advertisers had a better way to measure their ads’ success, and when they benefited from a user visiting their website, Google profited as well.

Nowadays Google Search Ads make up only one third of the Google Ads pie, therefore it’s important to know and understand all three basic categories. Let’s continue with Display Network Ads. 

Google Display Network Ads: 

These are the ads that pop up on websites whilst we’re browsing for other things usually. They can be on the side of a website or in between text paragraphs. These are most often animated or small videos even. 

Quick Overview of Display Network Ads: 

What they look like: Images/text/videos

Where they show: Google Display Network

How targeting works: Bidding on audiences (& demographics), content (keyword, topics, placements)

How to pay: cost-per-acquisition (CPA), return-on-ad-spend (ROAS), cost-per-1000 viewable impressions (CPM)

Display Network Ads in detail with example:

Again, let’s follow an example to make things a bit clearer for Display Network Ads. Imagine you are an airline that is looking to make people aware of their flight offerings to Norway. Whilst people are reading blogs about dog sledding and thinking about what sorts of other activities they might get up to during their trip, it’s the perfect opportunity to make people aware of the airline’s offering. Therefore, placing ads on those websites (e.g. a blog) would put their offerings in front of the right audience. I.e. people who are looking at things to do in Norway. 

These websites that allow advertisers to show ads next to their own content are part of the 2 million websites strong Google Display Network (GDN). These websites are of course not offering up valuable space on their websites for free, but are in turn using a platform called AdSense (the counterpart to Google Ads), through which they are paid for their ad space and can even decide what kind of content (and how much) they are comfortable with. 

In the screenshot above, you can see a dog sledding blog with an ad for TUI. In this case the blog has decided to offer up the space below the dog photo for potential advertisers. In this case TUI has won the ad slot through (yes, I am repeating myself) AN AUCTION! 

The auction can work slightly differently in the Display Network than in the Search Network, as advertisers don’t necessarily pay per click, but have the option to pay-per-1000 viewable impressions. This means if 50% of an ad’s pixels are on screen for longer than one second it will count as an impression and the advertiser will be charged. This means if a user has to scroll down to see an ad, the advertisers won’t be charged until the ad has actually been on screen. 

YouTube Ads: 

YouTube Ads, also called TrueView ads, are the ones that I’m sure you have seen whilst watching a video on YouTube. They’re the (usually annoying) ads that are forced upon you before you video starts playing or… even interrupt your video (how rude!). 

Quick Overview of YouTube Ads: 

What they look like: Videos

Where they show: YouTube (youtube.com) 

How targeting works: Bidding on audiences (& demographics), content (keyword, topics, placements)

How to pay: Cost-per-view (other options are available for specific YouTube campaigns only)

YouTube Ads in detail:

Here we are! Let’s talk about the final one of the three basic campaign categories. YouTube is certainly the newest addition to Google’s ad suite, as the company was only acquired in 2006. Long after they had been making money with Google Search Ads already. 

Now, I am sure we’ve all watched a YouTube video before and have gotten irritated by the video ad that suddenly showed up at the beginning or in the middle of the video we wanted to watch. In that eye-rolling moment, we suddenly see a small button appear that says “skip ad”. We smile to ourselves, skip the ad and continue watching our video. These so-called “skippable in-stream ads” are the most common YouTube ad there is. It’s brilliantly designed, as it gives its audience the option to skip, in case it’s not relevant to them. 

In the screenshot above you can see the in-stream video ad for a drink that was showing at the start of a dog sledding video I was trying to watch. You can also see the banner at the top right, which will stay even if the ad is skipped and for the duration of the entire video. 

One of the main differences between video ads and the other ad categories is that most of the time the success of the ad is measured by a view (rather than a click or an impression). That means whenever a view occurs the advertiser is in turn charged for it (same as with the click or impression in the Search and Display Networks). You might be wondering what exactly a view means in the ad world, and without going into too many technical details it means that a minimum of 30 seconds of the video ad has been watched (or, if the ad is shorter than 30 seconds, once the entire ad has finished).

If it feels like your Google Ads budget is bringing you nowhere, it might be worth having a look at your website, to ensure the traffic that you're driving is converted by a well optimised website.

If the above seems a bit too overwhelming, why not jump on a quick call with us? Schedule it here.

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