Know enough about Google Ads to be dangerous

Like many business owners, you may have heard about Google Ads and clicked on a few in your time, but you may not understand what they are all about. We’ll unpack the basics for you in this article, explain all the jargon and sprinkle in just enough information so you can have an informed discussion with a digital marketing agency or even have a crack at starting a Google Ads campaign on your own.

Sound good?

Using Google Ads may just be one of the best decisions you make for your business. Seriously!

Google Ads allows you to advertise and promote your products and services when users search relevant keywords. When done right, it has the potential to accelerate leads and sales.

Investing in online advertising helps you improve and quickly boost your organic marketing efforts by promoting it on different channels and increasing your brand’s overall reach. And while it can take months to see a result with Search Engine Optimisation (SEO), with Pay Per Click (PPC ads), you will see results immediately.

What are Google Ads?

Google Ads is an online advertising solution that businesses can use to promote their products and services on Google Search, YouTube and other sites across the web. Google Ads also allows advertisers to choose specific goals, like increasing phone calls or website visits. It is a flexible platform allowing advertisers to customise their budgets and targeting and start or stop their ads at any time.

How do they work?

Google Ads works by displaying your ad when people search online for the products and services you offer. Google Ads help get your ads in front of potential customers at just the right time when they are ready to take action.

Here’s an example of how you’d create a simple campaign:

  • Start by selecting your goal, like getting more visitors to your website or more phone calls to your business.
  • Next, select the geographic area where you want your ad to be shown. It can be super-local or broader, like cities, states, or entire countries.
  • Finally, you’ll craft your ad and set your monthly budget.
  • Once your ad is approved, it can appear whenever users in your target area search for a product or service like yours.
  • You only pay when users engage with your ad, such as clicking your ad or calling your business.

What are the different types of Google Ads?

Search network campaigns – usually in text form, these ads can show on Google Search results pages when someone searches for a product or service similar to yours.

Display network campaigns – usually in image form. These ads appear on websites or apps your customers visit.

Video campaigns – usually six or 15-second videos. These ads show before or during YouTube content.

How much to Google Ads cost?

Your budget settings determine your Google Ads cost. Google Ads gives you complete control over your budget. You are only charged when users interact with your ad, like visiting your website or calling your business.

What is CPC (cost per click) or PPC (pay per click) advertising?

CPC or PPC advertising means you only pay for an ad if someone clicks on it.

Other advertising models include:

Cost Per Impression – you pay based on how often your ad was shown (not clicked).

Cost Per Engagement – you pay when a user completes a predefined action (like watching your video ad)

So now that you are feeling a bit more comfortable with how Google Ads works, here are some KPIs that you should be tracking for your Google Ads campaign.

Return on ad spend (ROAS)

One of the most important marketing KPIs to track in Google Ads is the return on ad spend.

ROAS indicates how much revenue you generated due to your Google Ads. It is a percentage of your total costs in Google Ads to the total revenue you earned.

Tracking (ROAS) is critical as it allows you to keep track of your results and your Google Ads campaign outcome. It’s one of the main KPIs to measure campaign performance. To increase your (ROAS), it is important to understand what channels will bring you the most profit.

Click-through-rate (CTR)

By tracking CTR, you can gain valuable insights into how well your marketing campaign is performing. It indicates how many people have seen your ad and clicked on it.

As a business owner, you want to see your CTR growing. It is a real indicator of your ad performance. High CTR means that your audience found your ad attractive and relevant.

If your CTR is low, you might need to modify your ad. Keep in mind that the average CTR varies significantly depending on the industry. The golden rule is to see you CTR increasing overtime. 

Cost per acquisition (CPA)

CPA goes one level deeper than CPC. This metric indicates how much you pay for customer acquisition. Same as CPC, the average CPA varies significantly depending on the industry. Knowing your industry benchmark will help you determine how your ad performed. It is crucial to track this KPI since it shows you your acquisition costs in Google ads and how effective your marketing campaign is.

Conversion rate

When setting up your Google Ads, one of the most important goals will most likely be to increase your conversion rate.

Conversion actions can be different depending on your goal. It could be completing a form, watching a video, subscribing to your newsletters, making an online purchase or scheduling a call. It’s important that you define what is a conversion action for you in the ad.

In Google Ads, the conversion rate is the average number of conversions received per total number of ad interactions. It is calculated as a total number of conversions divided by the number of ad interactions.

Conversion rate depends on various factors such as ad quality, its relevance to the target audience or the quality of your landing page.

To ensure a high conversion rate, you should pay attention to the following factors:

  • Quality of your ad: especially the quality of the visual. It is often very powerful if you can show your target audience in the ad – so people can relate to it.
  • The relevance of your content: the key to success here is to make your ad relevant to your target audience.
  • Quality of your landing page: make sure that it has a user-friendly design, mobile friendly and is easy to navigate through your website to proceed with the conversion action for the user.
  • Check the loading speed of your page: high CTR and low conversion rates can signify that your landing page needs improvement and optimisation.

Quality score

This metric is defined by Google and represents an estimation of your ad relevance to your target audience. In other words, Google rates your ad on a scale from 0 to 10 based on its relevance to the target group. Scores above seven are considered to be a good score. A lower score means that you need to improve your ad’s relevance to the audience.

The metric depends on several factors, including landing page relevance, content, and keyword applicability. The higher the quality score you get, the higher the chances of getting better results with Google Ads.

The takeaway

Google continues to make it easier for business owners to set up a campaign and let it run. Without knowledge of the Google Ads platform, you’re more likely to do what Google suggests if you are not getting optimal results, and this could lead to you spending more, or investing in the wrong areas. You need to keep a close eye on your Google Ads campaign to ensure that your budget isn’t wasted.

This is where working with an experienced digital marketing agency can take the guesswork out of running a successful Google Ads campaign. You can work with them to set your goals, budget and define your target audience. Touch base with our team today and learn more about how we can help you turbocharge your leads and sales.

Written by Andrea Sevilla

Andrea is our Marketing Consultant & Copywriter who works with our clients to craft content for their websites, blog articles, promotional materials and more!

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