Paid Search 101 – An Introduction To Paid Search
New to Paid search? At 54 Digital we believe in a culture of sharing and educating, so we’ve created this paid search 101 guide.
It’s a long read but it covers the very basics from what makes up Google Search results, the dynamics behind bidding through to match types and ad copy.
This guide is designed for anyone either new to paid search or who would like a bit more info on the basics
We’ll keep creating paid search content and guides and start getting more technical as we go.
In this Introduction To Paid Search we are going to cover;
- Summary of how paid search marketing works
- Why would you run paid search marketing
- A quick at the difference between paid and organic listings
- How you are charged/what you pay for when running a paid search campaign
- Some dynamics of how the amount you pay per click is calculated
- How you show your ads to the right people, including an overview on keyword match types and the difference between them
- Writing relevant and high quality ad copy
- An example of account structure and again why match types are important
- A brief look at Google shopping and the differences with text ads
- And finally, a look at some strategies to help you get the most out of advertising on Google or Bing
For the purpose of this guide, we’ll reference advertising on Google but advertising on Bing follows in its footsteps.
The guide covers text ads and Google Shopping ads on the search results page.
2 points of terminology before we begin:
Search Query – The text that a user types into Google or Bing when searching
Keyword – Static text that you add into your Adwords/Bing account to match your adverts to the users search queries
Paid search can and should get a lot more technical than the guide below if you want to really optimise your media budget and performance as best as possible. This guide is designed to give a good overview of the basics.
There are a lot of different elements in paid search to help get the most from your campaigns. Feel free to drop us a line with any questions. You can contact us at email@example.com or use the contact form at the bottom.
This guide should give you a pretty good overview on what is involved though.
Let’s get to it..
What is paid search and how does it work?
Paid Search, also know as pay-per-click (PPC) is a way to advertise your products and services on Google’s search engine results page.
Think of it as a store front where you can reach potential customers. Instead of having a physical store where the customer must walk past, your store front is located at http://google.com
And, you can put your product in front of those customers without leaving your seat.
That is the key why advertisers use paid search, and why it can work. Millions of potential customers, all in one place.
What does it look like?
Google’s search results page (SERP) is divided into sections, with different types of content in different areas.
The paid search adverts, highlighted in red in the image, typically appear above the organic listings, highlighted in the image with a green box.
The organic listings do not form part of paid search and as such don’t cost when a user clicks.
However, with the paid listings, every time a user clicks on one of the adverts highlighted in the red box, it costs that advertiser a certain amount of money. This cost is known as the CPC (cost-per-click).
That money is paid directly to Google, and it’s a large part of how Google generates its revenue.
The good part is that each one of those clicks brings a potential customer to your site, and you can develop a strategy to minimise wastage and maximise efficiency.
Again, think of the search results as a store front, where just about any advertiser can put their shop in-front of relevant customers.
What are you charged for?
Advertisers are only charged when a user clicks on an advert.
When a user searches for a product or service, several adverts, as in the example above are usually displayed.
This is what is called an ad impression, each one of the adverts in the screenshot will receive one ad impression every time their advert is shown to a user. “Impressions” or “ad impressions” do not cost.
When your advert is only displayed, there is no change by Google.
The cost only occurs when a user clicks on an advert.
How much does a single click cost?
This varies massively between different industries, different devices, different times of day and a multitude of other factors.
Google uses a real-time auction based system to determine the cost of a click.
At the most basic level, with an auction system, the more bidders you have, theoretically the more expensive something can become.
Looking at the example above again, there are 6 adverts shown 6 different advertisers.
As you can imagine, there aren’t only 6 companies which are selling Sony TV’s.
The cost per click on your advert, in part, will be determined by how many other advertisers are trying to occupy that space in the paid search results.
Limited advertising space + lots of companies trying to show their products (may)= competition.
Increased competition in this case can lead to increased prices.
This is only one very basic element and just one thing to consider. A much more important factor is Ad Rank and the way Google determines relevancy.
There are lots and lots of clever strategies which you can employ to target the right user, at the right time to optimise the cost that you pay per click and your performance. You don’t have to try and show your advert for every single search.
And that is one of the beauties about paid search. Because it is so data driven, you can see the cost of individual keywords, and devices, and hours of day, and then the subsequent revenue/leads generated from that cost. You can optimise your paid search account in an extremely granular way to take advantage because we get such granular insights.
This is where the advantage comes in, creating a clever but uncomplex strategy to optimise for the peaks and troughs.
What else factors into the cost per click?
RELEVANCY and QUALITY.
Relevancy and quality are things which Google takes very seriously. So much so that a click may be cheaper for an advertiser who appears higher than another advertiser, if Google determines that the relevancy of their ad, and quality of the experience is greater than other advertisers.
Relevancy and Quality are something which Google classifies as Ad Rank. The better your ad rank, the greater the chance your adverts have to show, and possibly show in higher positions.
Ad Rank is a background calculation by Google (which you don’t fully get a view of) and at a basic level takes the quality and relevance of your advert to the search result, and the subsequent landing page that a user is directed to.
This relevancy factor is known as quality score, and every keyword you chose to show your adverts against has its own quality score, related directly to your account.
On a rank of 1-10. The higher the quality score, theoretically the higher your ad rank.
Ad rank is a calculation of how much you are willing to pay per click, multiplied by your quality score.
Ad rank/quality score, among other things takes into account;
- How much you are willing to pay per click on an advert
- How relevant the advert displayed is to the users search query
- Expected click through rate (see note on click through rate below *)
- The impact of other extensions such as sitelinks and call-out extensions (see note below)
- Landing page performance and relevancy
The better your ad rank, the better your foundation for performing against the competition.
* Clickthrough rate is a standard calculation by Google based on your performance. It takes the amount of clicks your advert receives, divided by the amount of times your advert was shown. If 100 people see you ad, and 10 of those people click your ad, you have a click through rate of 10%.
Why Is Ad Rank so important?
If you think about relevancy and quality, it makes total sense. By delivering highly relevant adverts to a user’s search query, this results in a better experience for the user (they don’t see irrelevant things) and in turn results in a better perception of Google, i.e. delivering relevant results.
Just as important, it also delivers benefits to the advertisers too, the more relevant your ad, then theoretically the more chance you have for it to be displayed, and the higher chance you have for a user to click on it.
This is a very simplistic view on the price you might pay per ad click and there are a lot more factors involved, a lot of which we will probably never know as they are part of Google’s algorithms.
But from a very basic point of view, just try and think that the more relevant and quality experience you can deliver when a user searches, technically the better it will be for all concerned including your performance.
How do you choose which search queries you show your adverts to?
At this point, it’s worth briefly delving into the two different types of content we can see within the paid search listings.
Removing the organic listings and just focusing on the paid listing as above. We’ve divided the content into two areas. The first area is known as “Google Shopping/PLA Ads”. PLA is an acronym for “Product Listing Ads” and its just the old name for Google Shopping Ads.
The second section, “Text Ads” are as they sound. Adverts made up of just text, no images.
We’ll focus on text ads to start and then touch on Google shopping with a brief overview.
Before we begin, for reference again, a search query is simply what a user types into the search engine when looking for something
The search query:
To decide which search queries you try and show your adverts to, Google (and Bing) have 3 main matching types as below. Bear with it, we’ll go into more detail on each.
- Exact Match
- Phrase Match
- Broad Match
In the Google AdWords system, you pick a word, or a phrase which you want to show your adverts against and add it into the system specifying one of the match types above.
The different match types determine what search queries your adverts can show against.
The match types that you use can have a massive impact on your performance.
Below is an overview on what adding keywords into your account looks like. Along with an overview on how each match type works.
Denoted by enclosing the word in square brackets  as below
Exact match means that your adverts will only* (see note below) show for the search query which you add into the system.
For example, in the AdWords system, if you enter the keyword [running shoes], you advert can only show when a user explicitly searches for [running shoes]. Your advert in this case, won’t show if a user searches for running shoes manchester.
To show your advert for that search, you would add the keyword [running shoes manchester] into your account.
You end up building a list of keywords which you want to show your adverts against.
You group these keywords into themes when creating them, and then your write adverts for each specific theme.
The idea is to create small groups of keywords and each group has their own specific ad copy.
For example, if you have three exact keywords:
- [running shoes manchester]
- [running shoes leeds]
- [running shoes london]
They would be classed as different themes of keywords for the purposes of relevancy and to deliver a good experience as the context of what the query is (different locations) is varied enough to justify different ad copy and ideally, landing pages.
You would write ad copy specifically for each set of keywords so that you have ad copy focused on running shoes in the different areas. This increases the relevancy of the search term to the ad copy which the user sees.
Creating greater relevancy from the search query, to the ad copy, to the landing page should have a positive impact on your quality score.
An example structure could be;
And on top of that, you can have individual landing pages for each of the keywords to tailor the experience further.
The idea is to segment, create relevancy, create a better user experience and ultimately better performance.
You should ideally have a strong percentage of traffic to your website coming through exact match keywords.
*Technical note on exact match:
During the guide, we talk a lot about “Exact Match” and that when you use exact match your advert will only show for exactly what the user searches for. Due to google doing some clever things in the background, even though we say “exactly matches” this isn’t always the case.
Google knows if a user misspells, for example if they search for “running sohes”.
Even though you don’t have the keyword [running sohes] in your account, google will class this as a close match and still show you advert, if you have the correct spelling keyword [running shoes] in your account.
Google is intelligent enough to know that a user meant the correct “running shoes”.
There are lots of other ways google does this too, such as plural and singular versions of a search query, and a recent change by dropping certain ‘function’ words.
On the whole, this is very useful because it means that you don’t have to think of all the ways a user might misspell all of the keywords which you have in your account, or include all of the plural and singular versions of a keyword.
Its slightly more technical but worth bearing in mind shortly into your life in paid search.
Denoted by enclosing the word in quotation marks “ ” as in the screenshot below.
The idea behind the structure and segmentation for phrase match is the same as exact match. The major difference is that your adverts will show to a wider range of search queries.
Phrase match in AdWords just allows you to match to a wider range of search queries while maintaining a good amount of relevancy.
When you use phrase match, the keyword you specify must be contained in the search query in the order that you specify, the query which your ad shows against can have other words either side though.
As a few examples, “running shoes” phrase match keyword could show adverts against;
- buy running shoes
- what are the best running shoes for trail running
- why do my running shoes hurt my feet
That last example query is a good one to look at. By using match types such as phrase and broad, you can show your ads to a very wide range of search queries. Care needs to be taken when building keywords with different match types.
Not showing your adverts against certain queries is just as important as showing your ads to the right queries:
As well as matching ads to queries, you can also tell Google not to match your ads to particular queries using negative keywords.
Negative keywords should be regularly added to the account, as an example, you may add the negative phrase –“hurt my feet” (denoted by a minus sign at the start). This means that you adverts will never show up when a user searches for ANY phrase with “hurt my feet”.
It doesn’t matter what the words at the start of the query or the end if the query. For any query with “hurt my feet”, if you add this as a negative keyword your ad will never show when a users searches that in Google.
Adding negative keywords is an extremely important part of paid search management and should be done on a regular basis.
In our advertising agency we don’t use phrase match that often. Unless its called for in a very specific case. Typically, we use exact match and broad match modified for the majority of our activity.
Broad match to follow..
Broad/Broad Match Modified
Broad and Broad Match Modified are technically the same “type” of keyword in paid search but they act very differently from one another.
Denoted by having no quotes or square brackets around your keyword as above.
Broad match keywords give a lot of control to Google about what your adverts can show against and they should rarely, if ever, be used.
For Example, the broad match keyword running shoes could match to related subjects and terms such as the london marathon.
The search query that your advert shows against can be related broadly to the keyword you have in added to your account. Quite often the search query may be only loosely related to what you want to show your advert for.
Broad match keywords should typically be avoided within your account.
Broad Match Modified (BMM)
Denoted by having a + sign before each word. Make sure to put a + before every word you enter.
Broad modified match (BMM) is a very useful match type and in general we would recommend using exact match and BMM as the main match types within your paid search account.
This is a very similar match type to phrase, but rather than needing to have the words in the exact order to match to a phrase, the words in your keywords, in this case +running +shoes can appear in any order.
This gives a great mixture of reach and having a good amount of control on what search queries your adverts show for.
Some example queries for matching to broad modified match with the keyword +running +shoes;
- buy running shoes
- shoes for running first 10k
- why do my running shoes hurt my feet
Again, we’ve included the example of a term that you probably wouldn’t want to match to why do my running shoes hurt my feet.
While broad modified match can give you excellent reach, you still really need to be regularly adding negative keywords into your account to stop wastage.
Does your paid search agency add negative keywords regularly? You can quickly see within the change history, or looking at a search query report to see what search queries are matching to. Check out or section on pulling a search query report.
Match Types Summary – Advantages and disadvantages of the different match types
Again, try and use Exact Match and Broad Modified Match wherever possible. You should have a strong split towards traffic coming through your exact match keywords.
Regularly add negative keywords in to stop wastage.
When looking at what search terms the broad match modified keywords match to (using an SQR report), add any high volume, good traffic terms into your account as exact match keywords.
That’s it for match types and how keyword matching works. Next we’ll take a brief look at what makes up ad copy and how you segment the keywords in your account to serve the most relevant ad copy.
Ad Copy overview
In its most basic form, ad copy is made up of two headlines, a description line and a display URL.
The two headlines can have up to 30 characters each, and the description line can have up to 80 characters.
And in Google, the ad would look something like;
The ad is relevant to what the user has typed into the search query.
Increase relevance, perform better.
You can add as many keywords into AdWords as needed/relevant and write specific ad copy to show to those specific queries. There is no point adding keywords for the sake of it, i.e. keywords which users will never search for.
As a note, these ‘groups’ of keywords as known as ad groups.
You segment your account by grouping keywords into relevant ad groups, and writing ad copy for each of those groups.
On top of the basic advert with two headlines and a description line, you can use lots of different features to make your ads stand out more. Known as Ad Extensions, Google massively encourages their use.
With ad extensions you can add a lot of supplementary information to your ad such as;
- Additional product links
- Reviews you have received
- The location of your business
- Any special offers such as black Friday.
Going back to the first example of Sony TVs, below is an example of an advert with a lot of the extensions added showing how much more information you can provide to a user and to qualify your advert and increase relevancy.
There are a large list of extensions available for different purposes and the use of extensions (or lack of) can directly effect the amount you pay per click now. Other common extensions not shown above are call out extensions and structured site snippets.
Note that the cost of each click can be directly impacted by the ad extensions you do or don’t have on your advert! Again Google is encouraging their use as much as possible.
That’s about all for a basic run down on text ads. We’ll cover Google Shopping next, not as in quite as much detail. In some ways it is a lot more complicated and other it is not. If you are planning on running and paid search its worth at least speaking to an experienced marketer, if only for some guidance.
Hours and hours could be spent talking about Google Shopping and the detail needed to perform well. We’ll cover this in more posts but as a start, an overview is below.
Google Shopping is highlighted at the top of the image above. Google Shopping Ads show;
- An image when your ad appears
- A price for the product
- The advertiser for the product
- A Title for the product
- Any special offers you may have
- Individual Product reviews if the data is available
As you can see from the image, there are typically more advertisers able to show for Google shopping ads.
In its most basic form, to run Google Shopping ads you need a file with all of the products you want to advertise for. This file is uploaded to Google (via the Google Merchant Centre) and you setup Google Shopping from there.
There is a lot of detail required in the feed that you supply to Google and a lot of the columns are required or you won’t be able to show your ads.
Unlike text ads, you don’t have keywords to tell Google what you want to match to.
Google takes the information supplied in your feed of products, and best tries to match your products to the users query.
One of the most important factors in this matching product to query is the title which you give your product in the feed you supply.
Two of the required columns are Product Title Product Description.
Every product you submit must have these, and you can write them to include the right information to match to the right product.
In AdWords, you then create groups of these products and decide how much you are willing to pay (your maximum cost per click) to show your ads.
In exactly the same way as with text ads, you can add negative keywords to stop your products showing to irrelevant searches.
There are lots of different ways you can segment your products for shopping and we’ll touch on this in another post.
Get in touch if you’d like some help with Google shopping, either setting up from scratch or optimising what you have running at the moment.
Shopping can be very tricky to get right if you are unsure on how it works. Get in touch with us (firstname.lastname@example.org) or another paid search professional if you are planning on running paid search but have limited knowledge.
Some Final thoughts
Ultimately advertising on Google via paid search is a set of rules and steps that you follow. If you have the basics then you have a chance for your advert to show. Where the real gains come in is taking advantage of Googles myriad of optimisation methods and utilising all of the tools available to you.
If in doubt, reach out with your questions to email@example.com. It’s easier to ask an informal question before than clearing up any possible issues afterwards.
Just keep remembering that relevance and quality are usually the key.
If in doubt, think “is my advert relevant to what the customer searches, and is my landing page relevant once they click on it”.
The more relevant, the more chance of getting those clicks and then subsequent conversions.
We’ve only touched on what is available in AdWords and to really master it takes years of experience.
We hope you enjoyed our guide to paid search. At 54 Digital we believe in a culture of sharing and educating. Get in touch if you have any questions or would like to see how we can work together.
Stay tuned for more articles for more articles and guides.
If you’d like any advice at all or an informal chat drop us a line. We are more than happy to help where we can and try and guide through the world of paid search.
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