What is Google Ads & How Does it Work?

What is Google Ads?

What is Google Ads? Google Ads is Google’s advertising system in which advertisers bid on certain keywords. These keywords lead to clickable ads to appear in Google’s search results. Since advertisers have to pay for these clicks, this is how Google makes money from search.

Does Google Ads work?

Depending on the competitiveness of the keywords you’re bidding for and the relevance of that keyword to real conversions for your company, Google Ads may or may not work for your business. For the most part, we’ve found that Google Ads is extremely effective for many kinds of businesses, as long as they don’t waste their money on the wrong keywords, or write weak, low CTR ads.

What are Google Ads keywords?

Keywords in Google Ads are the words and phrases that advertisers bid on, in hopes that their advertisements will appear on the search engine results page (SERP) when people are searching for those products or services.

What is search engine optimization?

Search engine optimization is the act of improving the visibility of your site or page within a search engine results page through organic strategies. By using search keywords within website content so search engines can find and display your site faster and more accurately.

What is an ad group in Google Ads? How do ad groups work?

An ad group is a container for your Google Ads advertisements, keywords, and landing pages. Google tends to reward advertisers who create Ads campaigns with tightly structured ad groups. It’s important not to dump all your keywords into the same ad group, but to organize your keywords into themes.

Keyword Bidding

How does Google Ads bidding work?

The position of your ad is determined by your ad rank. The highest ad rank gets the 1st ad position. Your actual CPC is determined by the ad rank of the next highest ad below you divided by your Quality Score.

What gets entered into a Google auction?

Once advertisers identity keywords they want to bid on, Google then enters the keyword from your account that it deems most relevant into the auction with the maximum bid you’ve specified as well as the associated ad.

Cost Per Click

What is CPC?

CPC, or cost per click, is the amount an advertiser pays each time someone clicks on his or her Ads ad.

How does CPC work?

Your CPC is determined by the competitiveness of your keywords, your maximum bids, and your Quality Scores.

What is the average cost per click on Google Ads?

The average cost per click on Ads varies by keyword and industry but is roughly $2.32 on the search network and $0.58 on the display network.

What is Actual CPC?

Actual CPC is the amount an advertiser pays each time a searcher clicks on their advertisement; this number varies depending on the other advertisers in the auction and is always lower than the maximum bidding price.

How does Google Ads calculate Actual CPC?

Actual CPC is determined by dividing the ad rank of the competitor below them (ad rank to hit) by quality score plus $.01.

What are alternative bidding methods?

Alternative bidding methods include CPA & CPM.

What is CPM bidding?

CPM bidding is based on impressions and can be used alongside CPC bidding.


CPC is the cost for an advertisement based on how many clicks it receives whereas CPM is the cost for an advertisement based on how many impressions it picks up.

Quality Score & Rank

What is Google Ads Quality Score?

This is a metric Google uses to determine how relevant and useful your ad is to the user, based primarily on your ad’s CTR, keyword relevance, and the quality of your landing page. The higher your Quality Score, the better: high-Quality Score keywords will save you money and earn you better ad rankings.

What is Google ad rank?

Google ad rank is the position of the company’s advertisement on the search engine page based on a combination of the company’s maximum bid and quality score.

Ad rank vs. Quality Score

The ad rank is how high on the page the advertisement will be displayed. Quality Score, on the other hand, is determined by the relevance and usefulness to the searcher and is only a portion of the advertisement positioning process.

What is ad position in Ads?

Ad position is the position on the search engine page results where the advertisement appears in relation to all of the other advertisements.

What is ad relevance in Google Ads?

Ad relevance is a measure of how related the keyword you’re bidding on is to your advertisements as well as how much your keywords match the message of your ads and landing pages. Higher ad and keyword relevance can improve your click-through rates and Quality Scores.


Burge Advertising, Your Advertising Partner

Google Ads is ever evolving, but is always a great way to get your advertising message in front of your audience. Customers on Google’s search engine expect to find the more relevant information and your ads must provide just that. We can help you create advertising messaging that is relevant and timely for users.

Contact Us Today!


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