Google Ads (formerly Google Adwords) is by far the most popular online marketing platform in the world and is constantly being expanded and optimized by Google with new applications.

Ongoing changes in the interface, design and technology have made Google Ads what it is known for today. See relevant ads in the right place at the right time.

Billing is done either by click (PPC – Pay per Click), but can also be done by CPM (per thousand impressions) in the Google Display Network (GDN), but more on that later.


This is what Google looked like in its infancy

In this post, we’ll give you an easy-to-understand and quick introduction to Google Ads and answer the question, “How does Google Ads work?”

With relevance to success

Google Ads is one of the great success stories of the Internet age. To this day it is a story full of changes and innovations. Initially, Google remained ad-free, but that was to change with the introduction of AdWords in 2000. At the end of 1999, Google tested the sale of advertising on a CPM (Cost Per Mile) basis, which at that time was the most common model in search engine advertising, and advertisers paid a monthly fee for Google to create and manage their campaigns. In contrast to the competition, however, Google did not rely on colorful advertising banners, but on subtle text ads that were displayed according to the user’s search terms. A short time later, however, Google changed this concept and AdWords became a service in which customers could determine their campaign settings and search terms themselves.

The new version of Adwords introduced in February 2002 gave advertisers the opportunity to offer a price for a click on their ad (Pay-Per-Click). The advertisers could now decide for themselves how much they want to spend on a click.

To prevent advertising companies from now – intentionally or unintentionally – placing irrelevant ads, Google introduced the quality factor.

This quality factor combines the click-through rate (CTR), the relevance of the ad text, keyword relevance (the previous performance of the keyword on Google) and the landing page relevance. Thus, Google Adwords enables a form of advertising on the Internet through keyword advertising and can place advertisements on Google search pages, as well as a huge selection of websites that belong to the Google Display Network.

The Google advertising networks

The search network

The search network includes Google search results pages, other Google websites such as Google Maps and Google Shopping, and search websites that have partnered with Google to serve ads.

In the search network, your ads are counted per click.

So you only pay for your Google advertising when a user clicks your ad and comes to your website.

google search

The display network

The display network includes Google websites such as YouTube, Blogger and Gmail, as well as countless partner websites on the Internet. In the display network, advertisements can be billed according to clicks or impressions, i.e. the number of advertisements.

The display network is therefore particularly suitable for building brand awareness.


In the case of new campaigns, the ads are shown by default in the entire advertising network, but you should always separate campaigns in the search and display fields, depending on the objective.

If you are not getting a good return on investment in a certain area of the advertising network, you can exclude individual websites from the display network. You can also change your campaign’s network settings to enable or disable the campaign for individual advertising networks

The importance of keywords

Keywords are words or phrases that are used to target your ads when users search for specific terms.

Setting relevant keywords for your campaign will help you reach potential customers at the right time.

In order for your ads to show when people search for your product or service, the keywords you choose must match the words or phrases they are searching for.

If a user searches for a term that matches your keyword, your ad can enter an auction. It is then switched depending on the result.

The cost of a keyword depends on the quality of the keyword, competitors in the auction, and other factors. Make sure that both your keywords and landing page are closely related to the terms a prospect is searching for or found on websites that a user is most likely to visit. So that you get a better understanding of the quality of your keywords, each keyword has a quality score.

This value is based on the expected click rate, the relevance of the ad and the user experience with the landing page. Higher quality ads typically translate into lower costs and higher ad position.

How to reach potential customers with the right keywords

1. Match keywords to company goals

Think about the different ways potential customers can see you.
Your keywords should be tailored to the many different searches people ask when looking for the products or services you offer.

2. Optimize traffic using negative keywords

Add new negative keywords regularly.
This avoids costs for clicks from users who do not become customers.

3. Increase the reach of the best keywords

Improve your ad rank to get the highest possible exposure for your keywords.

Adding new alignment options isn’t the only way to add volume. A higher bid in connection with an appealing ad can have a positive effect on the search volume of existing keywords.

How to write perfect Google Ads

google ads agentur

In the perfect ad, the text ad relates exactly to what the prospect is looking to buy. For example, a user searches for “flat screen express delivery” on Google and sees an ad with the title “flat screen 24 hour delivery”. He clicks on the ad and goes straight to the retailer’s website, where he completes his order. Here are the top six tips for creating successful text ads:

Make it clear what you are promoting: Your customers should know what to expect when they click your ad. Include at least one of your keywords in the headline. If you entered “digital cameras” as a keyword, your headline could be “buy digital cameras”. When using trademarked terms in your ad text, you must follow Google Ads branding guidelines.

Relevance: You should always offer your customers an answer or a solution. For example, if they are looking for a solution in their area, your location is the most useful piece of information and should be added to the heading.

Adapt description to the headline: The display must represent a coherent unit.

Match the ad to the target page: Go to the page associated with your ad (the landing page) and see if you can see the promotions or products from your ad. Otherwise, people may just leave your website.

Ads must be approved: To ensure that only high quality ads can be seen, Google advertising must meet high technical and editorial standards. For example, unnecessary spaces, incorrect use of upper and lower case, exclamation marks, or ambiguous URLs are not allowed. Learn more about text ad requirements

Address mobile users: You can create mobile-optimized ads that use the mobile version of your website as a landing page, and offer special offers for mobile users.

Nothing works without conversion tracking

Conversion tracking gives you clear insights into the success of your Google Ads campaigns and allows you to make targeted optimizations. It helps you use your budget effectively, improve the performance of your ads and maximize ROI.

Without conversion tracking, you would be in the dark and would not have a clear idea of which actions are actually producing results.

Conversion tracking is critical to the success of Google Ads campaigns for several reasons:

  1. Measurability of campaign success: Conversion tracking allows you to measure and evaluate the success of your ad campaigns. You can see exactly how many conversions (e.g. purchases, signups, calls) your ads have generated. This gives you clear insight into the performance of your campaigns and allows you to make targeted optimizations.
  2. Effective budget allocation: Conversion tracking helps you identify which campaigns, ads, and keywords are driving the best results. You can then focus your budget on those areas that have the highest conversion rate. This maximizes your advertising spend and avoids wasting resources on less effective campaigns.
  3. Optimize ad performance: Conversion tracking gives you detailed information about which ads are performing best. You can see which ads generate the most conversions and which are not so successful. With these insights, you can optimize your ad content, headlines, call-to-actions, etc. to improve the performance of your ads.
  4. Keyword relevance check: Conversion tracking allows you to see which keywords lead to conversions. You can find out which keywords actually bring qualified visitors to your website and lead to actions. Based on these findings, you can adjust your keyword list and focus on the most relevant and profitable keywords.
  5. ROI Optimization: By understanding conversions and associated costs, you can measure and optimize the return on investment (ROI) of your Google Ads campaigns. You can target your ad spend on those campaigns and keywords that generate the highest ROI and reduce or eliminate those with low profitability.

How to achieve your goals with the right bidding strategy

There are different ways to bid on ads in Google Ads, depending on the focus of your business. Most of the time, clicks, impressions, conversions, or views (for video ads) are the most important to advertisers.

When running ads on Google, it’s important to have a clear goal in mind. If you sell coffee, you might want to increase your customer base. On the other hand, if you run a hiking club, you might want to get more people to sign up for your newsletter. These are just some examples.

Knowing your goal can help you make the right decision about your bid strategy.

There are several bid strategies available in Google Ads that are tailored to different types of advertising goals and campaigns. Which strategy is best for you depends on the goals you are pursuing, the ad networks your campaign is targeting, and whether you want to focus on clicks, impressions, or conversions.

Choosing the right bid strategy is one of the most important measures for successful Google Ads campaigns.

Advertising goals and bid strategies

The bid strategies are suitable for different campaigns and advertising goals. There are four basic types of goals you can bid for.

Smart bidding

If you use conversion tracking and want users to take an immediate action on your website, you should focus on conversions. With Smart Bidding, you can do just that.

Google Ads then automatically optimizes your bids based on your conversion goal.

That is why it is extremely important to set the goals of your campaigns in a meaningful way.

CPC bids

If you want to get traffic to your website, it might make sense to focus on clicks. In this case, cost-per-click (CPC) bids may be best for your campaign.

Clicks are a good place to start if your main priority is to get more traffic to your website. When you use cost-per-click (CPC) bidding, you only pay when someone actually clicks your ad and gets to your website.

CPM bidding

If your aim is to increase brand awareness rather than drive traffic to your website, focusing on impressions is probably the strategy for you. You can use viewable CPM (vCPM) to reach potential customers with your message.

You can also use the “Share of possible impressions” strategy to maximize visibility.

CPV bid

If you’re running video ads and want to increase the number of views or interactions with the ads, we recommend cost-per-1000-impressions (CPM) or cost-per-view (CPV) bids.

If you are running video ads and your goal is to increase product and brand readiness to buy, you can use CPV.

How much does Google Ads cost?

For many advertisers, the cost of Google Ads is critical. The price you pay for a click on your ad depends on the competition for a particular keyword and the quality of your ads.

Every search is an auction

For every search query on Google, an auction is held in Google Ads to determine the ads that are shown for each search and their rank on the page. It also determines whether ads are shown at all.

Every time an ad can appear in a search, it must go through the ad auction. In the auction it is decided whether the ad will actually be shown, in which position it will appear on the page and how much the click on your ad will ultimately cost.

Auctions work as follows:

  1. When a user starts a search query, Google Ads finds all ads whose keywords match the search term.
  2. After that, we will exclude the ads that can’t be shown, such as ads targeting another country or being disapproved for policy violations.
  3. Of the remaining ads, only those with a high enough Ad Rank can be shown. Ad rank is based on bid, ad quality, ad rank limits, context of the search query, and the expected impact of extensions and other ad formats.

Even if your competitors bid higher than you, more relevant keywords and ads can still help you get a higher ad position for a lower price.

An auction is held for every search on Google. Since your result depends on the respective competitors, it can turn out differently for each auction. So it’s normal for your ad to vary in position on the page and sometimes it doesn’t show at all.

The click price per ad is calculated using the following formula:

Click price (CPC) = (CPC of the next lowest ad rank / own quality score) + € 0.01

Take your location into account

From many search queries it can be seen that it is important to the user where the company or business is located and that he can easily reach it.

In the last two years the number of mobile search queries with the term “near me” combined with “can I buy” or “buy” has increased by 500 percent. This clearly shows that more and more users also consider the location when they want to purchase a product or use a service.

You can target Google Ads campaigns by location. Then you can reach potential customers who are on the go, exactly where they are. This approach is particularly useful for text ads that serve alongside organic search results based on your keywords.

Nowadays users are extremely demanding. They are more likely to buy from companies that offer flexible delivery and collection options. Point out all the advantages in your advertising message and present your product inventory online. This way, potential customers are always informed exactly what they have in stock and where.

With regard to your obligations under the GDPR, you should seek legal advice. Because only a lawyer can give you legal advice specific to your situation. This website is in no way intended to be a substitute for legal advice.

According to the updated guideline on EU user consent from Google, you must disclose certain information to your users in the European Economic Area (EEA) and, if necessary, obtain their consent – e.g. B. for the use of cookies, if required by law, or for the collection, approval and use of personal data for personalized advertisements. This directive complies with the requirements of the EU data protection directive for electronic communications and the GDPR.

With Google Ads features like remarketing and customer matching, you can create or upload audience lists for targeting to Google Media and third-party websites. According to Google’s EU User Consent Policy, advertisers who implement remarketing tags or upload data files for target group lists for customer comparison must obtain user consent to collect data for personalized advertisements. In addition, when using conversion tags for analysis purposes, consent to the use of cookies is required.

Why should I run ads on Google Ads?

Google is by far the most used search engine in the world, with around 3 billion daily search queries. The Google Ads platform, which has been on the market for 20 years, has proven its worth.

Google is used by people all over the world to ask questions that are answered with a combination of organic search results and ads. According to Google, advertisers achieve an average ROI of 800 percent with their ads. So there are very good reasons why you should consider Google Ads as an important marketing channel.

In addition, you can be sure that your competitors are also using Google Ads (and they are probably even bidding on your brand or industry-specific keywords). Thousands of companies use ads to promote their products. This will cause you to slide down the search results and appear below your competitors.

If you are promoting your products or services online, Google Ads should definitely be a part of your strategy.

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