Ads is a powerful tool for small businesses, but you need to know how to use it.
Having a clear strategy and direction while using Google Ads, formerly called Google Adwords, can help your business get seen by more customers and grow an online presence. Ads accounts for 97 percent of Google's revenue each year. For a company that made $21.5 billion in 2016, this means that many businesses are using this program to try and connect with customers. By creating relevant and highly searchable web pages, you can beat out competitors and appear as a top listing associated with certain keywords.
Ads has been around since the early 2000s, and several strategies and best practices have emerged to help business owners create a stronger online presence and drive revenue through one of the world's most powerful search engines. When using Ads, the overall strategy should be building high-quality, SEO-friendly web pages and ads so your business can get a better position at a lower price.
How it works
Google Ads is a cost-per-click bidding system that prioritizes ad quality and relevance along with accounting for cost. The program differs from traditional advertising structures in that the highest bidder does not always receive the most prominent position on Google. Instead, Google incentivizes businesses to create high-quality, relevant ads by positioning the best ads more prominently for less money. For example, a coffee company with a high-quality ad will have a more prominent position and only be charged $1 per click while a competitor with a low-quality ad will be featured less and be charged $3 per click. Because of this model, Google has managed to create an advertising space where companies vie for position based not only on price.
The Ads process starts with a customer's search. Google runs a lightning-fast auction during every search a customer makes. Advertisers bid on keywords associated with certain topics, set a maximum price, and Google ranks each advertiser based on relevancy, ad quality, and overall cost. So, for example, a coffee shop owner may bid on the keywords "French roast coffee." Every time someone Googles these keywords, Ads reshuffles the auction and each offer is reanalyzed based on things like ad relevancy and maximum bid. The key to using Ads effectively is understanding how Google positions ads based on quality.
Google determines a business's position by multiplying the maximum bid by the ad's quality. Ad quality is determined in real time during each search and is based on expected click-through rate, ad relevance, and landing page experience. As a business owner, you can control your maximum bid, but if you have a high maximum bid and irrelevant, poor ads, your position won't be great and you will likely pay more per click compared to a competitor with a better ad.
Over time, each auction result adds up to an overall quality score, which is a score on a 10-point scale that reflects your business's overall performance in ad auctions. Your ad quality score is a good indicator when determining the quality of your ads, but it is not the same score that is used when Google determines your ad rank. That value – based on ad relevance, click-through rate and landing page experience – is specific only to Google and changes with each search.
The best way to have a good Ads ranking is to create high-quality, relevant ads by focusing on your ad's relevance to the keywords, expected click-through rate and landing page experience. After a few auctions, you can track your overall success through your 10-point quality score and try different strategies to improve your score.
Landing page experience
A landing page is the web page a searcher arrives on after clicking on your ad. Landing page experience is how Google determines whether your website gives the searcher what he or she is looking for. There are a few ways you can better your landing page experience beyond peppering it with relevant keywords. One way is by being tailored to your specific keywords – Google prioritizes sites that give users exactly what they are looking for. That means reflecting how specific each keyword is in your results.
For example, your landing page should have French roast coffee if you bid on the keywords "French roast coffee." You shouldn't have a landing page with a long list of different types of coffees since that's not what the user is searching for. This is an obvious example, but all too often, businesses try to push products or services on people who are looking for something different. If you're a business owner doing this, Google will affect the score of your landing page experience and your Ads rank will suffer.
Google outlines some other ways to improve your landing page experience on the Ads support site. Some other ways include allowing for both mobile and computer navigation, decreasing landing page load time and fostering trustworthiness on your site.
Expected click-through rate (CTR)
This is a keyword status that measures if your ad will get clicked on. Google determines this without factoring in your ad's visibility. It's based solely on the keyword and how well the keyword has performed in the past based on your ad's position. Google ranks the expected click-through rate according to three statuses: above average, average and below average. Above average or average means there are no major problems compared to all other keywords. Below average means that you may want to adjust your text so it more closely relates to your top keywords.
Improving your expected click-through rate score depends heavily on a case-by-case basis. Oftentimes, a below-average score can be fixed by adjusting your keywords or ad text.
While the overall concept of Ads is straightforward, payment per ad is a bit more complicated. The rate you pay per ad is broken down by two main factors: your quality score and the rank of the ad directly below you.
Google breaks down the payment by dividing the ranking of the business below yours by your own quality score and then adding 1 cent. So, if your quality score is 10 and the ad rank of the business below yours is 25, you would pay $2.51 per click. The business below yours, if its quality score is 5, would pay $4.81 per click. If you have a high-quality score, you will pay less per ad click compared to a competitor with poor ad quality.
With this model, Google is betting that you will pay more money overall because your ad will be clicked more compared to your competitors.
Where do they appear?
These ads appear as the first few results in a Google search. They are marked as "ads" on Google but can serve to provide a customer with exactly what they're looking for. They can also appear on non-Google websites that are search partners. These search partners are sites that have a native search bar on their website but offer combined results from both Google and the actual website.
Ads also extends to the Google Display Network. You can choose to have your ads appear on the collection of Display Network websites, which includes sites such as Gmail and YouTube. You can even go as far as choosing targeting methods by prioritizing ads based on keywords and related topics, specific websites, or specific audiences based on interests, demographics, or whether they've visited your site before.
In addition to these two areas, you can also prioritize your ads based on location, language or specific devices. There are some strategies you can implement to use Ads more efficiently. The key goal is increasing your ad quality and relevance to the specific keyword. This will allow Google to prioritize your results over that of a competitor.
Before diving into specific strategies, keep in mind that a successful Ads campaign starts with a highly relevant landing page and high-quality advertisements. Brainstorm some specific and clear campaigns before start using Ads. The higher quality the content and the more targeted the campaigns, the better.
The best thing you can do when starting an Ads campaign is to start small, learn the interface and understand how Ads can fit into your business. This will allow you to get your hands on the system and figure out what works best. Ads offers a lot of advertising options, so learning in real-time is a good way to determine what ways Ads can benefit your business.
Macaire and Bill Douglas are the founders of Half Pint Shop, a children's clothing and furniture store. They said they started using Ads two years ago, and it has since increased their online sales by more than $80,000.
"Really, it's just getting in and playing around and starting small, but also not being afraid to, once you're more comfortable, to actually invest so you can see the return," Macaire said. "I think a lot of people get scared of spending money, but we've definitely seen the return over time once we've gotten more comfortable with it."
This includes toying with analytics, experimenting with segmenting audiences and building different kinds of campaigns. Bill said the Half Pint Shop uses Google Shop ads as well as Ads.
"Maybe talk to some people who are already [using Ads]," he said. "Look at some guides before you dive in. You can actually learn the interface and practice without spending money."
This flexibility allows for business owners to learn Ads and grow their business without having to hire outside marketers or advertising firms.
Follow the data
Google provides some powerful analytics and data tools built right into Google Ads and Analytics. It's good to pay attention to demographics, how people are reaching your site and overall data regarding ad success and quality. Bill said that the Half Pint Shop values location. That way, they can segment users and understand what kinds of products people want based on region.
"I think location is pretty big because location is going to be able to segment certain people," he said. "People in San Francisco are going to be looking for different nursery furniture than people in Tulsa."
Prioritizing is just one example of using data to better target Ads that can drive sales. This example also serves for an even better tip: Segmenting users leads to results.
Segmentation is key
A key best practice when using Google Ads is to specifically target a group of people with your ads. More specific ads will be of higher quality and get rated higher by Google come auction time. It will also result in more interactions and engagements from customers. Both Bill and Macaire said that this was a very important aspect of their Ads experience, particularly when analyzing location. Bill said that Ads offers more opportunities with display ads.
"You can say, 'I'm going to do a boost or a target toward people that have been to the site already,' so a remarketing type approach," he said. "Or you can do a group that's similar to people that visit your site. So you can tag that and you can essentially boost the spend or the bid on ads for those audiences … There's a lot of different audience segmentation for things like that."
It may also help to seek advice from other business owners or professionals on this topic. Macaire and Bill said when they started, they bundled a lot of their products under umbrella campaigns that were general. After getting feedback from other business owners and tweaking their approach, eventually they started segmenting their audiences.
"I think you need to segment it a few different ways," Bill said. "One of the primary ways we do that is by brand. So we'll segment by brand and then within there you can kind of tweak the products that are higher or lower performers … Right now, we have segmentation for holiday shopping and have different pricing within that."
Google Ads is a good way to advertise your business without hiring marketing or advertising consultants. The interface is intuitive, and there is a lot of opportunity to learn how to connect with your customers. It may take some time to figure out, but once you're using Ads properly, it can be beneficial to your business.