Understanding Paid Search & Key Steps for Campaigns

Let's focus on how paid search actually works, and let's look at the seven key steps to conducting a paid search campaign. It starts with keyword selection, then the actual ad creation, your bid management strategy, ad auction, ad ranking, ad display, and finally performance monitoring and optimization.

So let's look at each of these steps. Keyword selection. Advertisers conduct keyword research to identify relevant keywords that potential customers are likely to use when searching for products or services relating to their brand.

Right, so these include the questions that your potential customers may have or generally ask in their searches, the features or benefits that they may be seeking. These are the types of terms that end up in your customer's search. So to understand this, you really need to understand your potential customers, your targeted audience, their wants, their needs, their challenges, the things that they are unsure about, and the information that they're seeking.

Keywords can be broad phrases or exact match types, depending on how closely they match user search queries. When we discuss keywords in more detail in the next section, we will talk about the difference between broad phrases and exact match types. Then there's ad creation.

This is where you create the ads that are relevant to the keywords that you chose. Ads typically include a headline, a description, the URL of the website that they're going to, and optional ad extensions. These extensions include site links, structured snippets, and local packs, and we're going to look at these extensions in detail because they are very important drivers of ad performance.

If you have more extensions, you have more ways that are engaging ways that people can click through to your website, the greater engagement, the greater clicks you're going to have. That's the point of these ad extensions: they provide additional information and encourage engagement. And here's an example for the Nike running ad.

First, you see the headline, browse men's running shoes. That's the headline description. Nike shoes and more latest innovations to help get more from your run.

However far you go, gear up at Nike, right? So that's the description. And then the URL is right here, www.nike.com. And then you have the ad extensions. One ad extension is the actual image of the sneaker.

And I can click through right on that and likely will come to a landing page with information about that sneaker and give me opportunity to purchase that sneaker. And there are additional extensions, such as this callout about a Mother's Day sale, right? 25% off select styles. So that can be very compelling.

If you're searching for a Mother's Day gift, you see that. That's more effective than just seeing browse men's running shoes, right? So that's why one of the reasons why ad extensions are powerful, right? So we'll see other examples of that and understand, like how you can get those, as part of your Google AdWords approach, right? Then there's a bid manager. Advertisers set bids, which represent the maximum amount they're willing to pay for a click on their ad, right? You can cap it.

I wouldn't pay more than $10 per click. Now, why would you do that? Because you understand how profitable that potential lead or that sale will be and what the margins are. So if you're paying too much per click, that might not be a profitable sale for you, right? So you know the maximum amount that you can pay and still meet your overall campaign budget goals, as well as the profitability return on investment metrics that you have in place.

Bids can be set at the keyword level or to automated bidding strategies based on campaign objectives, budget, and performance goals. And we're going to look at those aspects more closely when we actually set up a campaign. Also, understand that nowadays, Google, like other social media ad platforms, will also integrate AI features that will help you set your budget as well as adjust your budget when the campaign is up and running, and will identify the impact of a tool like that.

Then there's the actual ad auction, right? So when a user enters a search query, the search engine runs an ad auction to determine which ads will appear in the search engine results and in what order. So here you see all of these are ads that are showing up in your search engine results from different brands, Nike, Adidas, Dick's Sporting Goods. So the higher you are, the greater the likelihood of a click.

That's just historically been the case. And the top three gets over 40% of the clicks on SERPs, right? So you definitely want to be in the top three because there'll likely be other ads coming after that, maybe at the bottom of the page, and other portions of the page, the next page. So you want to be in the top three, and you certainly want to be as high to the top of the page as possible.

So the ad auction determines not just what ads will appear in the search engine results, but in what order. And the ad auction takes into account factors such as keyword relevance, bid amount, ad quality, and projected click-through rate. Actually, the algorithm projects or estimates which of these ads are going to create more clicks based upon these factors, right? How relevant the keyword is to the actual ad headline, copy, landing page copy, or description landing page copy.

The more, the higher the bid amount, the more likely you're going to win more auctions. So that's another factor. But the quality of the ad, the algorithm makes a judgment on the quality of the ad, and the quality of the landing page.

And that also is a determining factor as to which ads show up in these auctions and in what order. Then there's the ad rank. Each ad is assigned an ad rank, which determines its position in the search, right? So first, there's the auction, and the winners of the auction get to show up on the page.

Now, the determination is which will get the top position, the second position, etc. And the ad rank is calculated based on the ad's bid, the quality score, and the ad extension, the aforementioned ad extensions. Here, you see that each of these search ads has an ad extension with an image that you can click through, right? So they all were able to receive that particular ad extension.

The ad with the highest ad rank typically appears in the top position followed by other ads in descending order. So basically, you have the auction, which takes place. And that, you know, is going to determine what ads show up for what audiences that are typing in the search terms.

And then this ad ranking takes place, and that's going to depend, you know, on these factors, particularly the quality score, right? And ads that, now you have the ad display, ads that win the ad auction are displayed on the SERPs, typically above organic search results. So when you make a search on a page, the first thing that you'll generally see are the sponsored ads. And then after that, you would normally see organic results.

Of course, nowadays with the integration of AI-driven results, whether it's Gemini or Copoly, depending, you know, Gemini on Google, you will sometimes see either above the paid ads or between the paid ads and the organic results, you know, an AI synopsis or, you know, an answer to that particular query. The dynamics of that, you know, are becoming significant for Google search. I mean, well, certainly for Google organic search, since these, you know, the AI results come ahead of organic search.

But now the question is, will those AI results begin to negatively impact the Google ads that are being shown on a page? Because people are going to the AI results instead of the Google ads. So that's a really intriguing question with a huge potential impact on Google and search marketing. And we see how much money Google has generated through search marketing because of its effectiveness.

So we will have to see, you know, does this get impacted now by AI results, and what that means for the future. But for right now, you know, Google ads remain a very valuable and important way of creating awareness for your brand, driving website traffic, and driving conversions, as we mentioned. One other point about the ad display.

Advertisers are charged only when users click on the ads, hence the term pay-per-click advertising. And if you recall from the very beginning of the session, and we looked at the timeline, Google actually introduced that concept. And it was fairly significant in that it's more; it made the advertising on Google more cost-effective than platforms where you're paying for audiences, even if that particular audience is not clicking on your ad.

You only pay when they click. So now it's on you to make sure that they're clicking on a landing page that's going to maximize conversions, given the information they need. All right.

And then there's user interaction. When users click on an ad, they are generally directed to a landing page on the advertiser's website. Could be a homepage as well.

But best practices are to create a landing page specifically for the campaign. And on this landing page, you want to have a call to action. Here you see residential cleaning, book in 60 seconds, commercial cleaning, get a quote to facilitate either purchase, in this case, a booking or enrollment subscription, or in some cases, a contact form.

And everything on this page should be directed towards conversion. You want to make sure that the call to actions are clear. But just as important, you want there to be a transition between the copy, the headline, the description, or whatever other advertising aspects that drove that user from their search results to your landing page.

So if you're running an image ad, like one of the men's sneakers or the sneaker brands that we saw, and someone clicks on an image, and they get to a page where it's not clear where that product is, they get to a homepage, they get to something where they have to search for that product, there's going to be a drop-off. So the closer you can link the messaging on that ad to the messaging on your landing page, the smoother the transition will be. And then you want to make sure you have call to actions that are visible.

You want to make sure that you have all the information that the customer needs to actually convert, and nothing that's going to distract them from converting. And we'll talk more about best practices around the landing page. And then finally, performance, market monitoring, and optimization.

Google Ads provides analytics for metrics, such as clicks, impressions, click-through rate, conversion rate, and return on investment. All the important metrics that you need to monitor the effectiveness of your campaign. And then you want to review the analytics to evaluate the campaign's effectiveness.

And now you're in a position to make a data-driven decision to optimize the performance of that campaign and maximize your ROI. It's a very important step in the process. And doing this effectively is going to ensure that your campaigns will improve over time.