What is Google AdWords?

In order to master Google AdWords, you must first understand the basics. Google AdWords is an advertising service or businesses to display advertising messages based on users’ search query on Google. It operates under the pay-per-click  (PPC) model, in which advertisers only have to pay when the ad is clicked.


Paid listings, which are denoted by green boxes with the word ‘Ad’ in them, are listed on the top or
bottom of the search engine results page, followed by organic or unpaid listings. For some of the popular keywords, the ads may also appear in page 2 of the search results. In 2016, Google has updated the design of its interface and ads are no longer shown on the right hand side column of the search engine results page (SERP).

google serp adwords 2016


How does Google AdWords work?

Google AdWords works like an auction. The cost of each keyword varies based on the market demand – the more people are willing to pay for it, the more expensive the keyword will be. Here are some of the most expensive keywords in Google AdWords advertising.


#1 Targeting: Choosing the Right Keywords

To target your potential customers without wasting your advertising dollar, you have to understand how important keywords are in your AdWords campaign. The ads that you see on Google’s SERP are triggered by the search queries, which are carefully chosen and designed keywords or key phrases by the advertisers. The keywords that you selected for your AdWords campaign should be something that your customers actually search for. If you are able to identify and choose the right keywords, you are showing your ads to the right people.


Advertisers can create relevant ads based on the keywords people use. Google AdWords’ keyword
matching options are:

  1. Broad Match
  2. Negative Match
  3. Phrase Match
  4. Exact Match
  5. Negative Match

To simplify the keyword identification and selection process for advertisers, Google has developed a free keyword tool Keyword Planner to discover new keyword ideas, obtain historical statistics for individual keywords and plan your budget out.


google keyword planner tool interface


#2 Costings: Setting the Right Budget

As Google AdWords is a type of advertising, you will need to set a media budget that is affordable while not missing out on any potential business opportunities. If the bidding price of each keyword is different, how can you plan how much to spend per click, per day, per month or per campaign? In AdWords, you can set a maximum daily budget. Once the daily budget is exhausted after interested users have clicked on your ad, your ad will stop showing up on Google’s search engine results page for the rest of the day. After midnight, everything will be reset and your ads will be displayed as long as the budget is not exceeded. Note that Google will not charge you anything for simply displaying your ad (impressions). You will only need to pay if people actually clicked on your ad (clicks).


Let me explain this with a simple example. Say, you are the owner of a boutique flower shop and wants to do a special promotion for the upcoming Valentine’s Day. After careful calculation, you can only afford investing $3000 per month on Google AdWords, which means that your maximum daily budget is $100. Each click for your chosen keywords costs $5 on average. Up to 5PM, 20 people have clicked on your ad. Therefore, after 5PM, users will no longer see your ad on the Google SERP.


#3 Positioning: Writing the Right Ad Copy

google adwords copy example


As with all other advertising forms, your ad has to be able to standout in order to bring conversions. To create an eye-catching AdWords ad, the ad copy is critical. For AdWords, the quality of your ad directly affects the cost of advertising. The higher the quality of the ad (quality score), the lower the cost-per-click will be. Of course, there is a specific character limit for these text ads.


Limit for most languages Limit for double-width languages  (e.g. Chinese, Korean, Japanese)
Headline 25 characters 12 characters
Display URL 255 characters (35 shown) 255 characters (17 shown)
Description Line 1 35 characters  17 characters
Description Line 2  35 characters  17 characters


Here are 5 quick tips for designing your ad:

  • Write attention-grabbing headlines with keywords incorporated in them
  • Rewrite the display URL based on different keywords or ad groups
  • List your Unique Selling Propositions (USPs) in the sitelinks
  • Include a clear call-to-action
  • Add extensions to your ad whenever possible


Now that you have understood the Google AdWords basics, let’s look at some of the more advanced topics about keyword planning, keyword bidding, ad copy writing and more. Keep an eye on 10-hats for the new Google AdWords articles!