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I was talking to a prospective client and he asked me about Google AdWords. Specifically, he wanted to know what exactly AdWords was and how it could be used. This is a fairly common question, especially from owners of small businesses, so I thought it would be helpful to put together an introduction piece that covers the basics.

This article is meant solely as a top-level introduction. I have purposely left out advanced topics and points related to execution. AdWords offers a wide range of customizations but you can launch with a fairly simple setup and scale from there.

Basic Search Engine Marketing Terms

Running ads on AdWords is often referred to as search engine marketing (SEM), pay-per-click (PPC), or cost-per-click (CPC). For this piece, I am going to use SEM as the default moniker. In a nutshell, SEM means that you only pay when someone clicks on one of your ads. Other forms of advertising are based on impressions, which is people just being exposed to yours ads. Think of this as the difference between someone who sees a business’ sign and walks past the door to someone who sees the ad and enters the business.

I should also note that you can also run PPC ads on Bing but I generally prefer to start with AdWords. Google dominates the search market with nearly two-thirds of the market share so you are most likely to find your audience on AdWords. This is an especially important point if you are targeting a very small/defined audience. After you have some data on what’s working it is worthwhile to expand to Bing to see if you can lower your costs or expand your reach. Now that we have a general idea of what to call it, let’s talk about what it is.

Ad Placements

As alluded to earlier, Google AdWords is most often associated with pay-per-click advertising. They do offer other options but I believe starting with pay-per-click is generally best. In a nutshell, AdWords is an auction platform where advertisers (you) are bidding on keywords related to your business. For example, if you sell home brewing products, you may want to bid on the phrase “home brewing kit” as shown below.

Search Engine Marketing Results

Here you can see the SEM ads highlighted in yellow, appearing above the organic listings but below the product listing ads (PLA). Here’s the view when the keyword phrase is searched for the second time.

Expanded Search Engine Marketing Results

Now you will notice that product listing ads have shifted to the right and the SEM ads have expanded from 3 ads to 4 ads. This layout is a relatively new as Google just recently stop showing PPC ads on the right-hand side of the page.

In both views, the organic listings are pushed down, allowing SEM advertisers an opportunity to grab the attention of those searching for related terms.

Your placement on the page is based on your ad rank. According to Google, this is based on a combination of:

  • How much you are willing to bid
  • The quality of your ads and website
  • Expected impact from your ad extensions and other ad formats

Primary Advantages

Search engine marketing on AdWords offers two primary advantages. The first is that campaigns can be configured to meet a wide range of budgets. You can limit how much you spend per day, start/stop campaigns at will, and there’s no minimum spending commitment. SEM campaign budgets can also be set up to spend more at specific times or on specific days, giving you full control. This high degree of flexibility means you can test ideas without committing to a long-term spend.

The second advantage is that SEM advertising can generate immediate results. Unlike search engine optimization (SEO), which can take months to show results, SEM ads can start showing within a day or two.

Trackable Metrics

I believe that one of the key benefits of search engine marketing is that it is very “trackable.” The AdWords platform tracks a number of metrics on the ad side that can be used to optimize performance. Furthermore, AdWords easily integrates with Google Analytics and offers code that can be incorporated into your website. All of this creates a closed-loop ecosystem allowing you to understand how the advertising impacts your business.

Social Media Marketing

As a final note, I want to touch on social media advertising. As noted earlier, you can also run pay-per-click ads on other platforms such as Bing. This concept also extends to social media platforms such as LinkedIn, Twitter, and Facebook. While this is not, technically, search engine marketing, the same high-level concepts apply to pay-per-click advertising here. The idea is to target specific audiences and present ways for them to engage with you, the specific mechanics just vary from platform to platform.

Users engage each platform in different ways and each platform allows for different means of targeting. For example, you can target specific job titles on LinkedIn, which can be useful for business-to-business advertisers. Think of this like deciding on a new car. A full-size pickup truck and a smart car both transport you from one place to another but each has different benefits so the decision will depend on your unique requirements.

About the Author Nick Perry is a marketing and digital strategy professional who has worked in both B2B and B2C environments. With deep experience in software, SaaS, and financial publications, he specializes in helping small- and medium-sized businesses build, grow, and optimize their digital marketing. He can be reached at (513) 279-2075 - or emailed directly.