Everything You Need to Know About AdWords
Google AdWords allows eCommerce advertisers such as yourself to bid on chosen keywords so that you can have have clickable ads placed in Google’s search results. It is the biggest traffic-driving platform available, with Facebook ads coming in second.
Navigating and running AdWords can seem very daunting, especially to new online store owners who are using AdWords for the first time. For that reason, we’ve put together this comprehensive guide to help outline everything from cost-per-click and quality Scores to the terms you should know for a better understanding of the platform in order to bring in traffic for your store.
But first, some must-know terms to get you through this guide and help you navigate AdWords more easily.
Google AdWords Terms You Need to Know
Ad Extensions refers to the additional business info that appears with the ad. These include phone numbers, deals, special offers, additional URLs, etc.
Your set of budgets, targeting and keywords that make up your advertising objective is called an Ad Group. If you’re an online shoe store like the above example, the Ad Group of a promotion could include ad groups that target men’s shoes, women’s shoes and online sales; multiple adverts can be included in an Ad Group.
Ad Rank is based on your Quality Score and bid amount and will determine where on a page your ad will appear. We will get into this in more detail further down the post.
Bid Strategy refers to the type of bid you set up to pay for either viewer interaction or clicks.
Billing Threshold applies to automatic payments and is the total amount of spend set for when you will pay for ad costs within 30 days. This level starts at $50, and is raised incrementally each month if the spend exceeds this in 30 days. For example, if your Billing Threshold is $50, but you spend it within a 30-day period, your threshold will be raised to $100 per month and so forth.
Call to Action (CTA)
The CTA is the action you wish the online shopper to take and should be included in your AdWords ads. These include words such as “Act Now”, “Get Deal”, or “Buy Now!”
Setting up a campaign is your first step when setting up an AdWords promotion. A Google AdWords Campaign is made up of your Ad Groups which have the same budget, type and settings. You can run as many AdWords Campaigns as you’d like through your Google account.
Google AdWords Campaign Type refers to where you would like those ads to be placed. AdWords has four Campaign Types. These include:
- Display Network Only: Ads will appear on websites, videos, YouTube and more that are part of Google’s Display network. Also known as AdSense.
- Search Network Only: Ads that appear within Google’s search pages.
- Search Network and Display Select: These ads are a combination of display and search ads.
- Shopping: These are product listing ads for those eCommerce sites with Google Merchant Center accounts.
Click Through Rate (CTR)
AdWords CTR is a metric within your account setting that measures how many of the shoppers who have seen your ad, click through to your online store. This will enable you to measure how effective your adverts are with regards to text, etc.
CPC is the most common type of bid on AdWords. This literally means, how much it will cost you if someone clicks on your advert. Within your bidding options, you are able to set your maximum CPC, which is the maximum you want to spend per click.
Another AdWords bidding option, CPM is a method of charging based on the number of times your ad is shown online.
The is the amount that you are willing and able to spend each day, per ad.
This is the URL, or landing page, where the online shopper is directed to when they click the ad. You can use different Destination URLs for each ad in your Ad Group.
This is the URL that shows in your ad text. The trick is to keep it clean and simple, to help with brand awareness and conversion.
This is the headline of your ad copy and will show up blue on your live search ads.
Impressions is an important metric. It refers to how many times your ad has been shown to users.
The most important aspect of your AdWords ad are the keywords you use. These are the phrases or words that you choose to determine where and when your ads will be shown. The key is to choose your keywords based on what your potential customers will be searching for when looking for the kinds of products that you sell.
Google AdWords optimization refers to the changes and adjustments you make to your ads and Ad Groups to get better results with regards to your objectives.
The AdWords Quality Score is a measurement Google uses to prioritize ad placement. These are based on the keywords you use, your ad text (headline and description), the destination URL and the relevance of your ad. We will discuss this in more detail below.
AdWords Split Testing is a method by which you can conduct multivariate and A/B testing to help achieve higher conversions, ad ranking and CTRs.
AdWords Top Ads are displayed above organic search results, taking the top spot in someone’s Google search.
Google AdWords Basic Principles
AdWords Ad Rank
One of the most important Google AdWords principles is Ad Rank. As mentioned above, Ad Rank is based on your Quality Score and bid amount and will determine where on a search page your ad will show. In short, this ranking determines in which order all AdWords ads will be placed. The higher your Ad Rank, the higher you will place on the list. The formula for working out your Ad Rank for any ad is as follows:
Ad Rank = Quality Score * Bid
However, there is a way to tweak your Ad Rank through your ad spend. To beat the Ad Rank of your competitors, there is a minimum amount needed to get your ad placed above theirs on the list. This amount is referred to as the Discounter. Here’s a formula to help you work out what Discounter amount you should be using.
$$ = Ad Rank to beat/Quality Score + $0.01
AdWords Bidding Strategies
If you wish to advertise through AdWords, you will need to place your ads into an auction, or bid, for its placement. These auctions are run by Google to find ads to place in its organic search pages. But it’s not just a matter of bidding what you can afford; for AdWords, you will need a bidding strategy to ensure you are getting the best ROIs for your allowable budget. There are three main AdWords bidding strategies.
CPA: Cost Per Acquisition
Best suited for intermediate AdWords advertisers, CPA is a bidding strategy related to the conversion rate of your customers. It allows you to control your advertising spend more tightly, as you pay per sale conversion as opposed to per click.
CPC: Cost Per Click
This bidding strategy is one where you, the advertiser, pays for every click you get from your AdWords ad. This is the best AdWords strategy for new or established online businesses to drive more traffic to their stores.
CPM: Cost Per Impression
As already discussed, this bidding strategy is a method of charging based on the number of times your ad is shown online. CPM bidding strategies are best suited for those eCommerce stores looking to build their brand online.
AdWords Quality Score
The overall quality and relevance of your AdWords ad will be determined by its Quality Score; one of the most important AdWords metrics. Google measures this to ensure AdWords ads are useful for shoppers and ensuring that when they click, they are taken to the page or content they are looking for. What this means for you as an online merchant is this: If your Quality Score is higher than that of your competitors -- even if their max bid is higher than yours -- your ad will appear above theirs.
Your ad’s quality is determined by your account performance, CTR, ad performance and relevance.
Determining Your Ad’s Quality Score
AdWords Quality Score is a score between 10 and 1, with 10 being the highest -- best -- score. To determine your Quality Score, go to your AdWords Keyword Tab.
You can get there by doing the following:
- From your AdWords dashboard, click on the Campaigns Tab.
- From the Campaigns Tab, click on the Keyword Tab.
- Click on the white speech bubble which is located near the Keywords Status.
- Check the CTR, relevance and user experience stats for your ads.
How Ad Rank is Affected by Quality Score
The components of your Quality Score will affect the Ad Rank of your AdWords ads. These include landing page experience of the shopper, the auction-time calculations of expected CTR, your bid strategy and your daily budget. Therefore, by improving your Quality Score, these components that make up the score, you can improve your overall AdWords Ad Rank.
Here are a few components of your Quality Score that contribute to your Ad Rank:
This means that the text displayed in your ads should be relevant to what a person is searching for. In other words, ads with deceiving text that prompt shoppers to click, only to find the page has nothing to do with the text, are penalized.
Landing Page Quality
Landing pages that are informative, easy to navigate and relevant will improve your ads’ Quality Score and thus their Ad Rank.
Performance Targeted Devices
Your ads should perform well on ALL devices -- laptops, smartphones, tablets and desktops - to ensure a good Quality Score.
The definition of Expected CTR, as per AdWords, is the following: The expected clickthrough rate (CTR) AdWords provides for a keyword in your account is an estimate based on the assumption that the search term will match that keyword exactly. You can improve this metric by improving ad impressions, historical clicks over time, the position of your ad, etc.
To ensure a good Quality Score, your AdWords ad should be able to reach your targeted shoppers within the geographic location you have targeted.
Benefits of Using Google AdWords for Your Online Store
Unlike other forms of advertising, AdWords is highly measurable. Platforms such as social media and SEO result metrics are not as transparent as Google AdWords. Measuring ROIs and evaluating results and trends allows advertisers to quickly adjust strategies to better sales conversions and build brand awareness.
90% of the world’s online community use Google. Therefore, AdWords gives you access to an unprecedented reach for affordable prices. Small online businesses are now able to reach millions of potential customers for much less spend than traditional, old-school advertising.
Google’s AdWords network is created in a way that it shows users highly relevant ads. In other words, it reaches the customers that are specifically looking for your kinds of goods and/or services so that you are able to attract highly targeted traffic, resulting in more sales conversions.
One of the biggest AdWords advantages is that it is highly customizable. Online advertisers have access to an abundance of flexibility, allowing them to adapt campaigns and reach to their budget. Within AdWords, you are able to create an ad, choose your target audience, choose your own keywords and set your own budget. It also offers you flexible bidding strategies and formating - the type of ad and where it is displayed -- and therefore gives you full control.
As mentioned in our SEO vs PPC post, AdWords offers eCommerce advertisers almost instantaneous results. As soon as a campaign is live, you will instantly get clicks and impressions. This makes optimization highly effective as you can adjust any parts of your ads for better performance, in real time.
When using AdWords, you have tight control over your budget. You are able to increase or decrease your spend as you need to, based on your budget restrictions and your objectives.
Main Disadvantages of Using Google AdWords for Your Online Store
Optimization & Management Can Seem Overwhelming
Yes, AdWords can give you the best ROIs out there, but many smaller business owners struggle to keep up with the day-to-day management and tweaking needed for this platform to perform at its peak. This can be overcome in one of three ways: learning what you can on blogs such as this one, and if you have the budget, hiring a professional agency. If you don’t have a huge budget, you can still get help with optimization by using Apps such as our Traffic Booster that takes over the management and optimization of your AdWords account . We developed technology that uses a unique algorithm we developed to automatically optimize, getting much better results for less spend.
Huge eCommerce brands have almost unlimited budgets and manpower, meaning they can monopolize in an arena where small businesses struggle to compete. The trick is to market yourself within a niche and avoid costly name brand keywords that will have very little return on investment.
Charged Per Click
AdWords doesn’t discriminate when it comes to PPC. There is no differentiation between someone clicking by accident, per say, or someone coming to your site with the intention to shop. This means you pay for every click regardless. Because of this reason, it’s very important to have a good strategy in place to prevent paying for a high percentage of clicks when there is a low conversion of sales. You can do this by making sure you are attracting highly targeted traffic, and providing a great shopping experience once they are there.
Limited Competitive Data Access
Unlike Facebook -- who reveals some competitor data - Google doesn’t provide any such metrics. In other words, as an advertiser, you are unable to compare yourself with your competitor as a way of improving or bettering your strategies.
AdWords Campaign Creation Tips
Use Negative Keywords
One of the most under-utilized types of AdWords Keywords, are the negative keywords. Google AdWords negative keywords tool will assist you in taking out all the irrelevant keywords that are not related to your site and therefore improving your ad/campaigns overall Quality Score.
Go to your AdWords keyword tool, where you generate the keywords that are relevant to your niche. To find the negative keywords, simply change the match type to Negative.
It’s important to choose negative keywords carefully and that they are somehow related to your businesses. If you’re an online store selling glasses, an example from Google, then appropriate negative keywords would be “drinking glasses” or “wine glasses”.
Don’t Mislead Potential Customers
Your targeted keywords need to be in the content of your landing page and in your ad text. Misleading potential shoppers to get them to click will have negative results on two fronts: Firstly, your conversion rate will be low, as clickers will not spend time on your site or trust your brand. Secondly, the result of the above behavior will drop your Quality Score and ultimately your Ad Rank, pushing you further down the line.
Use Relevant Keywords
Choosing the right keywords can make or break your Google AdWords Campaigns. It is important to choose keywords that are both in demand and compelling -- i.e relevant.
- Use your AdWords Keyword Planner to help you choose the most popular and in-demand keywords in your niche.
- Keywords should be relevant to the goods you are offering and the target audience you are trying to reach.
Monitor and Optimize
Your AdWords ad campaigns should be tweaked and monitored on a regular basis to ensure you are keeping costs low, results high and keywords on point. The plus about AdWords is that campaigns can be optimized and edited at any given time while they are running. Bigger changes to bids and daily budgets can also be adjusted by doing a quick ad pause. Yes, it does take a lot of time and energy, but it also insures that you will be getting the best ROIs for your buck.
And lastly, target your AdWords ads. As an eCommerce store, it’s not just traffic you want, but targeted traffic. By using exact phrases and keyword matches, user behavior, user devices, user location, and separating Ad Groups by keyword type, the traffic you draw through your PPC campaigns will be much more targeted.
There you have it, the tip of the PPC iceberg. If you are looking for ways to improve your traffic using AdWords with minimal hassle, get in touch or head over to our Traffic Booster app.