The Guide: Demystifying AdWords

Harness the power of search by facing your fears and getting to grips with the basics of the world’s largest PPC platform.

So you’ve got your website in decent shape, and your conversion rate and AOV are going up and up. But, it’s not much use if you don’t have enough traffic. If you want to even register as a blip in a noisy marketplace, there’s only so long you can avoid paid search (clue: it’s not very long). Of course, this means getting to grips with AdWords, with its various metrics, settings, bid management, quality scores, and the rest. Once you know what you’re doing, it’s not nearly as intimidating as it sounds. But if you’ve never done it before you’d be forgiven if it leaves you nonplussed. In the name of upping the clarity factor to marginally less mud-like, we’ve put together a short introduction to Google AdWords.

What is AdWords and how does it work?

AdWords is a tool that lets you display a short text ad to Google users when their search query matches a predetermined set of keywords or phrases. Every time a user searches one of these terms, your ad is entered into the Google auction where you compete with other sites to rank in the paid search results. Where your ad is positioned in those listings depends on the maximum amount, or bid, you and your competitors are willing to pay per click, along with the relevance of your ads and website content to the user’s search. You then pay when the user clicks through to your site.

Keyword grouping and account structure

One of the keys to building a successful pay per click campaign is choosing a good set of keywords, so one of the first things you’ll need to do is to identify the keywords people are searching for.  Your keywords should of course, relate to your business and importantly, they should also be mapped with the content on your site. It’s important that the pages you’re directing users to actually answer their query.  Once you’ve chosen your keywords you’ll be able to group them into tightly related ad groups. You can then group your ads based on the sections or categories that appear on your site.

Understanding the metrics

To get the best results from your AdWords campaigns, it’s a good idea to have a basic understanding of the key PPC performance metrics and to monitor these daily. First up we have impressions and clicks, impressions being recorded when your ad is served and clicks, as you’d expect, when a user clicks on it. Your click through rate or CTR is one of the simplest measures of your ad performance; the more relevant and engaging your keywords and ad copy, the higher your CTR will be.

Next up we have quality score which is a rating calculated out of 10.  When this is applied to your keywords it has a direct effect on your ad rankings and the cost of your clicks. The quality score is calculated by Google based on various factors including the relevance of your keywords, ads and website content as well as your maximum CPCs (cost per click) and CTR. The higher your quality score, the lower your CPCs are likely to be and the higher you are likely to appear in the search results.

Finally, we have conversions and conversion rate. A conversion is counted when a user completes a specified action. This could be making a purchase, signing up to a newsletter, downloading a brochure or clicking on a mobile call ad. Your AdWords interface will show you conversions that have occurred after a PPC ad has been clicked. By analysing conversions, conversion rate and cost per conversion, you can identify which of your keywords, ads and landing pages are performing well and where you need to improve.

Managing bids

Bid management is one of the more challenging aspects of AdWords. There are several ways to manage keyword bids and which is best depends largely on what you’re trying to achieve. You might be looking to drive traffic to your site to build brand awareness, or you might be more focussed on conversion and ROI. Either way, it’s your objectives that should determine how you set up your bids.

If you’re just looking to drive traffic, you can keep things simple with CPC. However, you can also choose to bid based on your conversion performance by setting a maximum CPA (cost per acquisition) in which case Google will decide the best CPC for your keywords to try to get the most conversions for your budget. If the idea of letting Google do the work for you is appealing, you can, in both instances, choose the automated bid settings which will try to bring you the most clicks possible within your budget. In all cases, the crucial thing is to manage your budgets carefully and set caps. If you don’t you could be in for a nasty surprise.

So there you have it, the basics of AdWords, congratulations on getting to the end alive! This is of course only an introduction; running an effective campaign means taking the time to know AdWords inside out. If this isn’t something you can do, there are plenty of expert paid search publishers who can run your paid search for you, often on a CPA. For more information on either running your own paid search or working with a paid search publisher, chat to your account manager.