How Google Adwords Works

Keyword Quality Score:

• indicates relevancy
• determines minimum bid
• calculate from:
  • historical CTR
  • relevance of keywords, ad group ad texts and landing page to each other
  • other factors
• continually tweaked by google

Minimum bid:

• the least amount which can be paid per click for a keyword
• high quality score decreases minimum bid

Ads may be targeted by language and location.

Benefits

Reach:

• global
• 80% of US Internet users
• large search and content network

Cost:

• no minimum spend
• controlled budget
• pay per click or PPM
• accountability

Timing:

• targeted to interest
• users see ads as their purchasing needs arise
• ads are matched to these needs

Flexibility:

• only a 15 minute setup delay
• easy to change, 24x7
• target locations and languages
• tools & reports

Strategy:

• build brand = target impressions and clicks (visits)
• generate leads = target sign ups
• generate sales = target conversions

Account Structure

3 level hierarchy: account > campaigns > ad groups:

• account = email, password, billing, preferences
• campaign (max 25) = name, dates, budget, ad rotation preferences, target languages and locations, CPC or CPM
• ad groups (max 100) = set of ads plus targeted keywords (or sites for CPM)

Campaign types:

• keyword targeted: CPC bid for each keyword (or default per ad group)
• site targeted: CPM bid for each site (or default per ad group)

Conversion tracking

• track different conversion types - sale, lead, signup, page view or custom
• average conversion value can be provided to calculate ROI
• dynamic value can be sent with each conversion

Summary and detailed performance reports available for

• keywords / sites
• ads
• landing pages
• ad groups
• campaigns
• account

Ad formats

Text ad format:

• Title - 25 chars
• Line 1 - 35 chars
• Line 2 - 35 chars
• Display URL - 35 chars

Image ads

• max 50k
• must fit one of given formats
• may be used in keyword or site targeted campaigns
• only appears on content network

Video ads

• static image, with click-to-play
• click while playing goes to website
• must fit one of given formats
• may be used in keyword or site targeted campaigns
• only appears on content network

Local business ads

• appear on google maps

Mobile ads

• two lines of text 12 - 18 chars
• display link and/or call link
• destination url for mobile webpages
• pay-per-click or pay-per-call

Pricing

$5 activation fee

Costs controlled by:

• daily budget (per campaign) controls ad frequency
• max CPC (per ad group or keyword) controls ad position
• account quality / relevance
• Google provides a recommended daily budget for maximum exposure for the selected keywords and CPC bids

Understanding ROI

• ROI = profit / investment * 100%
• = (income generated - advertising expense) / advertising expense * 100%
• CPA = cost per (customer) acquisition

Content network

• separate max CPC can be set for the content network per ad group
• can't set separate max CPC for individual keywords
• smart pricing reduces actual CPC for clicks from sites which have a low conversion rate

Overdelivery

• when daily cost exceeds daily budget
• overdelivered amount over invoice period is refunded
• may overdeliver up to 120% to compensate for underdelivery

Billing cycle

• payment options vary in different countries
• credit card, debit card, automatic direct debit, invoicing and bank transfer payment methods available
• US: prepay (credit or debit) or postpay (credit, debit or invoice)
• accounts are billed every 30 days or when credit limit reached
• credit limit increases with spend (up to USD500)

Billing issues

• ads suspended if credit card is declined
• user must initiate card retry

Invoicing

• invoiced accounts are not suspended on credit card decline
• 15 day payment terms
• require USD1500 monthly spend for 3 months, plus Adwords history to apply
• monthly credit limit determined by google
• if credit limit is reached ads slow or are suspended

Keywords

Selecting Keywords

• relevancy = likelihood the user making the search is interested in the product or service
• keyword tool chooses variants based on common searches
• use negative keywords on common irrelevant terms to protect your CTR
• general keywords have a low CTR
• specific keyword phrases have a better CTR
• add plurals, synonyms, typos, misspellings and variations of your keywords
• submitting to Google Sitemaps makes Google track keywords for your site

Ad rank for each keyword:

• rank = CPC bid (keyword) * Quality Score (keyword)
• actual CPC is the amount required to maintain current rank
• actual CPC = rank (next lower) / Quality Score + 1c
• minimum bid is required to enter auction
• minimum bid depends on quality score
• increased budget = more impressions
• increased CPC bid = higher rankings

Keyword matching options

• broad
  • all keywords must be in query
  • may be in any order
  • may be synonyms or variants
  • query may contain other terms
  • lots of impressions can cause low CTR
  • best used with multiple terms
• "phrase"
  • exact phrase occurs in query
  • query may contain other terms before or after phrase
  • synonyms not used
• [exact]
  • phrase must match query exactly
  • no synonyms or variants
• -negative
  • keyword must not appear in query
  • can add negative keywords on a campaign level
• -[embedded]
  • excludes exact queries

Targeting

The Google network

• search and content networks
• content ads are matched to the content and theme of the page, text, language, and targeting settings
• sites in content network are reviewed for quality
• context of keywords is used to infer their meaning (e.g. 'java')
• opt in or out of networks on a per campaign basis
• smart pricing reduces the price of clicks on content network if conversions are lower
• content bids can be manually edited
• reported CTR does not include clicks and impressions for the content network
• site targeted ads are not matched contextually

Site targeting

• choose individual sites from the content network
• choose sites by topic, category and demographics
• exclude specific sites
• bids are made by CPM
• text or image ads allowed
• ad always fills entire region (text or image)
• to win auction, CPM bid must beat effective CPM (eCPM) of all other ads

How google targets users

• google domain (e.g. google.fr, google.de)
• query parsing (e.g. hotels in boston)
• IP address
• configure language preferences

Language and country targeting

• better targeting = more productive traffic = higher ROI
• use 1 ad group per language for global targeting (ensures keywords matche ad language)
• regionally targeted ads include region at bottom of ad text

Customized targeting

• by latitude and longitude with radius (worldwide)
• by address with radius (select countries only)
• by polygon (worldwide)

Optimizing

campaign optimizations

• reorganize campaigns
• change targeting
• adjust delivery times and positions

ad group optimizations

• add/adjust keywords
• edit ad text
• adjust CPCs
• reorganise ad groups
• change keyword match types

website optimizations

• choose landing pages
• edit landing pages
• improve site usability

ad scheduling

• configured on a per campaign level
• bids can be increased or decreased during specific periods (10% - 1000%)

misc

• poor keywords can be improved by changing match type and ad texts
• get keywords and ad ideas by browsing clients website
• also browse competitors' ads and websites
• make the landing page highly relevant to the ad
• highlight your differences from your competitors
• sites can be excluded on a per-campaign level

Increasing clicks

• add new or unused keywords
• use keyword variations
• include general keywords
• put keywords in add text
• advertise additional products
• create more specific ad groups
• increase budget
• increase max CPC
• improve quality score
• broaden targeting
• show ads on search and content networks

Increasing conversions

• understand consumer buying cycle: awareness, interest, consideration, purchase, retention, advocacy
• use negative keywords to filter out non-purchasing customers. e.g. -free, -info, -how to, -what is, -definition
• use specific keywords
• include a call to action in add text
• use prices in ad text (and compare prices in competitors ads)

Optimizing CPC

• compare value / click with cost / click
• remember ad position affects CTR and ROI
• increase CPC for profitable keywords to get better position
• decrease CPC for unprofitable keywords to reduce margins

Tools

Traffic estimator

• estimates based on provided keywords, CPC and targeting:
  • impressions and clicks
  • ad position
  • daily spend on keyword or ad group
  • keyword status and minimum bid
• can also offer suggested bids to be in position 1 85% of the time

Change history tool

• shows a three month log of all changes and who made them
• doesn't show:
  • max CPC changes made by the Budget Optimizer
  • changes by the Ad Automator (?)
  • ad approvals and disapprovals
  • password changes

Ad diagnostics tool

• shows where ad appears in search results
• identifies why a keyword isn't triggering ads
• identifies why ads are not showing

Disapproved ads tool

• shows reasons and suggestions for disapproved ads

Adwords editor

• windows/mac desktop app for managing adwords account
• can import / export account archives
• keyword grouper puts similar keywords into separate, new ad groups
• includes tool to find duplicate keywords
• allows you to add comments in various places
• allows export for sharing and collaboration

Google Analytics

• webstats
• performance data for ad campaigns
• track visitor behaviour and demographics
• profiles separate domains, subdomains or subdirectories
• can declare conversion goals to track
• a funnel is a page sequence to get to a goal
• can add filters to ignore some data (e.g. views from inside company)
• can manage multiple users to access data

Google Analystics campaign tracking features

• compare performance of various marketing efforts
• add variables to url to indicate traffic source (tags)
• tag campaign name, source, medium, content, term

My Client Center

• access all accounts with single password
• view many accounts on single dashboard
• allows separate billing, reporting and keyword auctions for clients
• can't edit client's login and billing preferences

Adwords API

• access to adwords via web services
• not free - 25c / 1000 quota units
• req token to use api
• one token / developer
• one token / application

Troubleshooting

Account wide issues

• ad must be approved to appear on partner networks
• must meet partner requirements
• must verify email address to appear on partner networks

Campaign specific issues

• campaign is paused, deleted or ended
• daily budget reached or exceeded
• targeting excludes your location or language
• incorrect or conflicting negative keywords

Ad group issues

• CPC bid > daily budget
• ads are paused or deleted
• ad doesn't meet editorial policy
• ads for adult sites only shown on adult domains
• min 1 ad and 1 keyword/site required

Keyword specific issues

• keyword CPC > daily budget
• keyword is disapproved, deleted or inactive
• inactive if CTR on google sites too low
• reported CTR is for all google network sites
• nb: keyword performance is *account* wide
• Find and Edit Max CPC tool can do mass updates

Invalid clicks

• clicks generated without interest in the ad (e.g. for financial or competitive gain)
• may be manual or automated by software
• invalid clicks are detected and not charged
• detection technology is proprietary

Non-indicators of invalid clicks:

• duplicate IP addresses in weblogs can be from NAT
• low ROI can be from poor landing pages

Legitimate causes of spikes in click volumes:

• comparison shopping
• competitor pulling an ad
• recently approved ad / ad changes
• hot news story on content network
• seasonal products
• change in budget

Policies

Link Policy

Display URL:

• doesn't have to exactly match destination URL
• must indicate who owns destination URL (e.g. match domain portion)
• must be a valid URL
• http:// and www parts not required
• cannot be an email address
• must adhere to editorial policies

Destination URL:

• must link to a working website
• no under construction / broken landing pages
• landing page must be viewable by web browser (i.e. html, not pdf or other)

For affiliates:

• only one ad per display URL is ever shown
• don't duplicate other sites' content

Other:

• back button may not be disabled / modified
• no pop-ups or pop-unders on landing page (entering or exiting)

Editorial Policies

Ad quality criteria:

• clear and concise
• relevant and targeted
• reflect Google values and aesthetics
• attention getting, but accurate and honest
• no hidden surprises

Punctuation:

• can't be used solely to attract attention
• standard spacing applies around punctuation
• not unnecessarily repeated
• no exclamation in title
• only one exclamation in text
• symbols, letters and numbers can't replace words (e.g. sms slang)

Grammar:

• text must be a sentence or phrase
• proper grammar must be used
• ALL CAPS not allowed
• no repetition for the sake of promotion (max two repetitions)

Language:

• correct spelling except accepted variants
• no offensive language
• no self censored expletives
• some call-to-action phrases not allowed (e.g. click here)
• Google trademarks not allowed
• superlatives and comparatives must be qualified by a third party on the landing page
• competitive claims must be supported on the landing page

Prices (when quoted):

• must be available < 2 clicks
• need not include freight or tax
• okay if bulk price quoted
• discounts must be shown < 2 clicks
• free is only allowed if item really is free

Image Ads Policy

Quality:

• text ad policies apply
• clear and readable
• all text legible
• content easily understandable

Layout:

• must completely occupy selected space
• not rotated / inverted
• cannot show multiple ads
• cannot duplicate / interfere with user bar (where google adds links)

Content:

• must be family safe (viewable by minors)
• no adult material
• no bad language
• no fake ui

Animations:

• no strobe effects or flashing backgrounds
• no fake ui animations
• no games / prizes
• 30s max length of animation
• max 3 loops, no continuous loops

Trademarks

Trademarks:

• registered word, phrase, logo or symbol which distinguishes a product or service
• same trademark may be registered in different industries
• rights are territorial (per country)

Policy:

• Advertisers are responsible - Google generally doesn't get involved in disputes
• (US/CAN) may remove trademarks from ad text on complaint
• (US/CAN) won't remove trademarks from keywords
• (not US/CAN) may remove trademarks from both ad text and keywords

Copyright

• right granted for exclusive publication, production, sale or distribution of a work
• policy applies to website content, ads, search results and Groups postings
• fax or mail complaint required
• counter-complaints possible