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What are AdWords?

Guest post by: Bob Dumouchel

Article Overview: Overview of Google Adwords

What are AdWords?

Believe it or not this is one of the most common questions we get. People hear about AdWords, but they are not really sure of what they are or why they should care. This is Google's fault because they really are not great communicators. Their mission is to organize the world's information but like the cobbler's shoes they either struggle with or simply do not care to communicate the value of AdWords. You would think that Google would try harder since AdWords is their golden goose and Microsoft is now in the second position nipping at their heels in the search market. Here is my attempt at a simple description of AdWords: Adwords is an auction priced self-service advertising system that delivers ad content relevant to the other page content.

Google's primary goal is to provide advertising that enhances the search experience and, in Google's eyes, this mission is much more important than your money.

Let's take this statement apart piece by piece.

Auction Priced: One item that throws people new to the system is that unlike other advertising where the cost is set by the publisher, in AdWords the cost is set by the competitors seeking the same ad space. Because keywords often cross over different industries you will often be competing for ad space with businesses that are not your normal business competitors. Your bid is not what you pay. What you pay is one penny more than the competitor behind you. This is how changes by competitors drive your costs up.

Self-Service Advertising: Adwords is a computer system that requires on-going maintenance and there is no auto-pilot button. Your campaigns use a keyword and bidding model built and maintained by the advertiser. How well it works depends on how well engineered the models are.

Relevant Ad Content means that Google is looking to deliver the best ads associated with the actions of the searcher. They view the ads as an extension of the natural listings and they rank them in a very similar fashion. They want to deliver ads that are likely to be of interest to the searcher based on the keyword match or the content or actions of the searcher. They take this extremely seriously and will not display ads that are a severe mismatch no matter how much you are willing to spend on that position.

Advertising that enhances the search Experience: New advertisers often fail to believe how serious Google is about this. Other Publishers will sell their soul to close the deal and collect your money; Google is not like these other publishers. Google places the priority of producing the best quality SERP (Search Engine Results Page) well above your money. Given the option between improving the SERP or increasing immediate revenue they will pick the SERP quality every time. This surprises Advertisers. It really shouldn't though because the secret to Google's success is the quality of their SERP. This is a core corporate value and not a marketing slogan.

The heart and soul of AdWords is the keyword matching and its simple appearance is misleading at best. The process includes phases of eligibility and ranking. For eligibility there are four positive and three negative forms of keywords used to match to the searchers search query and multiple statuses that create a test for display eligibility. After eligibility is established quality score and bid are used to determine the ad rank. Assuming the keyword met eligibility and ranked high enough to make it to the page the ad is displayed. This is, of course, a very high level view of this process and the devil is in the details. In the matching process it is important that you fail the eligibility for searches that do not apply to you. In a pay per click world impressions might seem to be free but if you follow the system you will find that you pay for those excess impressions later. They drive down your click through rate lowering the quality score and increasing your cost on future clicks.

Why should we pay you to run AdWords?

The other form of this questions "Why can't I just run AdWords myself?" and the answer is you can just like you can prepare you own taxes. Businesses that are large enough to have a full time accounting staff still engage CPA firms that specializes in taxes because they know it a full time job just to keep up with the changes and the latest strategies. When it comes to rapid changes in policy and practice the IRS has absolutely nothing on Google. Changes at Google are non-stop and according to spokesman Matt Cutts they average more than one change per day and that is just what they admit to. At least the IRS has Congress to slow them down! After working with Google AdWords since 2003 I can tell you that you are always one click away from discovering some new function or feature that was not there yesterday. It is a rare day in our office when there is not a new discovery for the entire day. While I do not propose that AdWords is as complex as the US tax code, it is certainly not simple. At a basic level almost any business person can set up an AdWords account, put in some keywords, write a few ads, and get results from the system. The problem with this is that the campaign is not going to run at maximum effectiveness and it can leak money and opportunity at light-speed.

AdWords is where marketing, systems, language, and people collide in cyberspace and when played at a serious level it is complex and competitive. It is complex enough that Google has not one but four certification tests for its certified partners. There are three major networks including Google Search, Search Partners, and Display and each of these networks is complex enough to write a book on. Its competitive enough that businesses spent $22.8 billion in 2009 and its on track to increase 22% for 2010 based on results through Q3. Add to this the analysis of how the traffic acts after it gets to your web site and it's time to engage serious people for your team.

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Article Tags: Google Adwords



Related Forum Posts
Using Google Adwords - Can't you do the same thing in AdWords for $.05 and get more targeted keywords?
Re: That First Customer! - Hey Tristan, I felt the same way too with my businesses in the past. Getting the first customer is always the hardest. One day I used a free $100 Google AdWords coupon and got one visitor to buy my e-book. It was one of the best feelings. My advice is to keep going and change your approach to improve your service or website. Once you break through, the journey will become a lot easier.
AdWords - The way I understand it - with AdWords, the price depends on which keyword you choose. Some keywords are really cheap because they aren't in demand, while others are much higher because they are in demand. If you have 2 people that want one keyword, but 200 that want another -- the 200 are going to pay higher prices. I've only looked at it a little, but I have a Google account where I get paid if people click on ads and the amounts vary drastically. Chris
Using ezine articles for blog posts/ Pay Per Post update - [quote:2df58gt3]And the interesting part is these posts are not even his own, but are something he just imported from ezinearticles.com [/quote:2df58gt3] I hadn't considered using ezine articles to make blog posts...hmmm, that raises the possibility of starting up quite a few blogs, that I myself wouldn't have time to write, and just using - with appropriate credit - the words of others! On a side note, I just got an email saying my blog had been approved for Pay Per Post, so I'll be able to start in on that and report back any results. Fingers crossed that I'll get a click for $96 myself! Although the highest click I've ever gotten was $1.50, I believe...I'd still like to know how it's possible for some AdWords people to get their ads down to 1 cent per click, because I could never get it that low, when I was trying the program.....
Re: Kevin's Case Study #7 - How do you promote your new book? - [quote="orxan":kako3o5q]Hi Kevin, Normal conversion rate is 2% for me. High conversion rate can be 5-6% or more probably. But if you use Google Adwords techniques properly and have the good sales letter, then it can be 25-30% or more. It depends on books too. If it is exciting and shocking book with great sales letter then it will determine the rate of conversion, too. Orxan[/quote:kako3o5q] Hi Orxan, What are some Google AdWords techniques you can share with us that generate 25-30% conversion rates? Thanks


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