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It is not that difficult to see why AdWords has gained such critical acclaim. You can get up and running in no time and start making money with Adwords in a few simple steps, with the support of Google along the way.

The business model is tailored to fulfill a marketer’s needs. You only pay when a user takes a desired action (a click, call, or a purchase). This ensures a clear and controlled return on investment.Consumers are stating their needs clearly online and it is imperative that businesses are on the front-lines to solve customer problems. With Adwords, you can do just that.

Google's slick interface has recently been upgraded and can get brand spending rather quickly. Behind the whole game, however, is a subtle blend of PPC (Pay Per Click) art and science.

The aim of this section is to provide you with an understanding of PPC, to get users up and running with AdWords through a combination of definitions, tips, and best practices.

AdWords offers various options for Display, Shopping, Apps, and Video campaigns. However, for the sake of simplicity, we will narrow this article down to AdWords search campaigns.

STAGE 1: Keyword and audience research

The first step in setting up an AdWords campaign is to gain an understanding of consumer demand for your products. We can approach this by defining which business objectives that we wish to deliver with paid search marketing in order to provide some form of structure to the entire process.

AdWords plans can be pretty expensive, so consider where they fit alongside your marketing efforts. Given the interplay between the two, SEO and PPC are usually included within the same keyword strategy. PPC can, however, fill gaps within SEO visibility or help strengthen good SEO performance by doubling the brands' presence on high-value keywords.

This becomes more significant when you are at the later stages of your AdWords account setup. However, it is a good idea to think about the scope of PPC in marketing channels as early as possible. Furthermore, in order to get your PPC campaign off to a great start, there is a lot of work involved outside of the AdWords interface that you need to consider.

The Google Keyword Planner is undoubtedly a useful tool to conduct audience research, but it is not the only available resource out there. Before moving toward Google AdWords, marketers should:

Keep a survey of current customers -

To find out the brand’s unique proposition and what keeps them coming back to the purchase.

Consider speaking to the customer service team -

Customer care teams hold invaluable data on the most frequent areas of strengths and weaknesses cited by consumers about the business. You can leverage that data to find out the positives, or act against the negatives of your business.

Work with other departments -

Brainstorm ideas on how to improve the brand, its products, and what exactly is the company hoping to achieve using AdWords.

Analyze the competition -

Third party tools can provide you with a good sense of how your competitors are approaching their paid search. This will help you gain an understanding of the landscape, and gain some useful tips on which keywords might be valuable additions to your list.

Once you have prepared a framework, you can enter the ecosystem of Google and include your keywords to analyze the projected costs of your campaigns. The AdWords keyword planner reveals how frequently a keyword is searched and how much it costs when a user clicks on a paid advertisement.

Google automatically suggests a variety of relevant keywords that are semantically linked to your seed terms.

It is easy to get carried away with your AdWords terms which makes it essential that the volume drivers for your business are specific and focused. The terms can be expanded later on, but for now, it is best that you stay with a smaller set of keywords in order to get a good sense of the market and familiarize yourself with AdWords.

We can segment our audiences on the basis of consumer demographics, interests, past website behavior, and location. A less popular method would be to just focus on keyword bidding.

The demographics and segmentation will be discussed later on, but for now, we have a specific set of keywords that we know our brand wants to advertise for.

STAGE 2: KEYWORD MATCH TYPES

With the exception of a few circumstances, people do not always search for products in the same way. An identical search intent (information regarding a product, for example) is expressed in the searches.

Let us suppose that you are buying lounging pants. Your search terms can range from [buying lounging pants online] to something more specific like, [where can I buy lounging pants near me ], or even as simple as [lounging pants].

As an apparel business, your focus should be on selling more of your product. Therefore, you do not want to restrict yourself to a single search term. Your goals should focus on selling the product in as many relevant situations as possible. This is where the keyword match types come in. Match types restrict both visibility and allow Google’s match technology to make decisions on the basis of keywords that are most relevant to display your ad. Let us look at some of the match types:

Broad match -

This match type allows room for interpretation. With a broad match, you can tell Google that you want to bid, and have ads displayed for any variations of your target search term [red men's lounging pants], or even [beige colored men's lounging pants]. Your ads can also show synonymic variations that include the specified words.

Phrase match -

Phrase match gives more control to the advertiser. Let us suppose that you want to bid on "lounging pants". Your advertisement would show up when the phrases match within the quotation marks or when these two words appear in order. They can, however, be accompanied by other modifiers. An example of modifiers would be [lounging pants for women], or [striped lounging pants].

Exact match -

Exact match is a misnomer. It allows advertisers to specify the exact terms that they want to display, but it is not 100% accurate. The inaccuracy falls primarily to Google, which made some controversial changes to the format in the past year, meaning that keyword targets set as an exact match can show up as close variants of the defined term.

Let us go back to the imaginary apparel store. Let us suppose that you set [lounging pants nyc] as your target. Exact matches will have your ads served against [lounging pants in nyc] or even [nyc lounging pants].

It is best to inspect your search queries to analyze how the exact match type has been made.

For more information on broad, exact, and phrase match keywords, check out this article on common PPC keyword mistakes.

Negatives -

An essential part of the keyword set up is negatives. Negatives help us specify any queries or modifiers that we do not want to categorically show. For example, you might not want to display an advertisement for lounging pants that include the words "used" or "second hand".

You also might not want to add particular brands, colors, or styles. You can simply add them to your negatives list and upload them to AdWords. This provides essential control for brands since most companies have a clear vision of how they want to be perceived by customers.

Exact matches might be great for targeting, but it restricts your reach. Broad matches get impressions on your site, but they will not be the ones you would want. Tweaking the negatives list and shifting towards a keyword strategy that sets a balance between exact, phrase, and broad keywords will prove beneficial for your strategy.

STAGE 3: CREATING PPC ADS

Once you have finished defining the keywords that you want to target, we can move on to the next phase of your plan, which is creating an ad copy. This is a crucial element of setting up AdWords. With the right ad copy, you can significantly increase your chances of improving the click-through rate (CTR) that your ads receive. Even with a well thought out keyword and bidding strategy, there is no guarantee of traffic. You should always consider why an ad-viewer would stop and choose your brand over everything else calling for their attention.

To increase the communication between advertisers and the audience, Google has introduced a new PPC standard, called Expanded Text Ads (ETA). The ads are designed with mobile devices in mind and provide greater communication between the advertiser and the audience.

Expanded Text Ads consist of the following elements:

Headline -

Two headline fields for 30 characters, which either appear side by die or on separate lines, depending on the user’s screen.

Description -

An 80 character filed where you write the core reasons why prospects should engage with your ads.

Destination URL -

This is the landing page users will be sent to, so it is worth spending time testing different landing pages to see which one works the best for specific queries.

The fields will be displayed as follows within the AdWords interface:

Ad extensions -

As an advertiser, you have access to a wide range of extensions, allowing you to highlight offers, benefits, or unique selling points to your audience. These also bring up the advantage of taking more space in the search results page, which can prove positive for the click-through rate.

From the example query below for car insurance, advertisers are ensuring that the new formats take up as much real estate as possible.

We will not provide a detailed discussion on ad extensions in this guide, but it is good to know that some appear automatically while others require some form of input from advertisers before they show. You can check out a possible list of extensions here.

STAGE 4: SETTING UP AD GROUPS AND CAMPAIGNS

Everything that we have discussed above is to prepare you to start categorizing your keywords and ads into ad groups.

This is achieved by separating your products and services and creating ad groups for each. If we go back to the example of sleepwear (lounging pants) we can demonstrate a clear and logical approach towards achieving this.

Each of the ad groups will have 2-4 ad copy variations, which can be updated on an ongoing basis as we start checking performance data. Each keyword can be set to the match types outlined above.

After you have tested out this product, it may be wise to think about branching out into the “pajamas” market. This is where the concept of campaigns is introduced, which are placed above keywords and ad groups on the basis of importance.

To sum it up: keywords make up ad groups, and ad groups make up campaigns.

If some keywords are particularly profitable, marketers prefer to isolate them into their own ad groups. This provides a lot more control, but it is labor-intensive and r estricts the amount of data used for optimization.

STAGE 5: THE FUNDAMENTALS OF ADWORDS BIDDING

The auction phase of AdWords shows how much you pay for each particular action and which position your ad will be displayed for selected keywords.

First of all, it is important to know that AdWords operate as sealed and second-price auctions. Cornell University provides a clear explanation of this phenomena.

What you bid is not exactly what you always pay. A second consideration is that budgets are set on a daily limit. However, Google has decided to allow accounts to spend up to double the amount each day as long as they are still hitting their targets.

This is distributed over the course of months, and Google never charges advertisers more than 30.4 times their daily allotted budget. So if your account spends double the daily limit on a frequent basis, you could max out the budget rather quickly.

Automated Bidding -

Google uses a wide range of machine learning and rule-based automation technology to deliver the maximum value to advertisers in their auctions. We can state to Google our objective, and how much are we willing to pay to achieve that objective. Their algorithm does the bidding on our behalf.

This might make automated bidding very appealing, but it comes with its fair share of cautionary tales from the industry. Therefore, it should be approached with some degree of reservation.

Giving the entire control to Google can altogether lead to very costly campaigns and, while setting a sensible ceiling on maximum bids can prove useful, automated bidding can lead to inefficient spending. Machine learning systems feed off the data and learn from it, which means that the budget can be spent in a wide range of areas to gain this knowledge.

Manual bidding -

If you are a beginner, then manual bidding is a great way to get started. This option provides a considerable amount of control, quick feedback, and the ability to adjust on the basis of performance. As your account increases, however, you would tend to lose some control. But if you have a small set of ad groups, then you would definitely benefit from this approach.

Google has also added the option to adjust bids on the basis of a user's device. This means that marketers can increase ads for specific queries on a mobile device, for example, if they know that their device typically converts better on mobile than on a desktop device. This is reflective on the user-behavior since people tend to use their mobile or desktop for different purposes.

Quality score - Quality score is an important aspect of bidding with Google AdWords. It dictates how much a brand pays for clicks. The intention behind the Quality Score is simple: Google wants to ensure that relevant advertisements are showing against its searches and also want to stop low-tier websites from exploiting the system to gain high ranking positions.

The exact equation behind a quality score is not known, but we can still make some safe assumptions. The score is based off a scale of 1 to 10, with 1 being provided to irrelevant ads and landing pages, while 10 is awarded to brands that match a user’s intent with relevant ads and a great landing page experience.

Quality Score is calculated on the basis of keywords, which means that you could see different scores within the same ad group. There is still room for experimentation and it is worth the effort because a high-quality score can make your budget go further.

WordStream provides a helpful image to show how this process works:

AdRank is explained in a lot more detail here, but this metric is a good representation to determine which position your ads will appear on search result pages.

Google has recently added a long-awaited feature that allows advertisers to view historical Quality Scores, which allow us to view any positive or negative trends over time. You can gain more information about this feature here.

STAGE 6: REVIEWING AND OPTIMIZING PERFORMANCE

As a marketer, if you want to get the possible output from AdWords, you need to keep a close eye on the performance and be prepared to make adjustments. There are four metrics in particular that you need to keep an eye on. They are segmented on the basis of device type, demographics, and location. Respectively, the four metrics are:

Click-through rate (CTR):

Number of clicks and impressions on your site.

Conversion rate (CVR):

Number of conversions and clicks.

Cost-per-click (CPC):

The cost allocated with one click.

Cost-per-acquisition (CPA):

The cost of acquiring one customer.

These steps will get your AdWords campaign up and running with the correct foundations in place. There is a lot more you can gain from the platform, and advertisers are rewarded if they invest the time in more advanced features.

However, all of this starts with the basics and as long as marketers keep monitoring performance and are open to new strategies, the more complex will be the pieces.

Let’s recap before moving on to Google Webmaster:

In this section, we went through a detailed discussion of Google AdWords. We went through the several stages of keyword research and talked about keyword match types, creating PPC ads, setting up groups and campaigns, the fundamental principles of bidding with AdWords, and finally, how to review and optimize performance. In the next section, we will be providing you with an in-depth discussion of Google Webmaster tools.

All of the marketing elements we have discussedin this section and the previous sections are great marketing tools in their own right. But they all fall apart when you do not have a way to actually get people to interact with them.

That is where Pay Per Click marketing comes in. A final frontier, so to speak. Ever see those little text ads after the Google Search box whenever you type a search? Well, that is PPC in action. PPC marketing is an effective way to reach a prospective customer base at a point closest to their purchasing cycle. Hence, the final frontier.

You might not be planning to run a PPC ad campaign, but there might come a time when you feel that it PPC becomes critical to your customer acquisition strategy. It is, therefore, best to understand the process flow of PPC beforehand so you do not run into any roadblocks.

The goal of this article is to provide you a little more than a birds-eye view with regards to PPC. You will find a general description of a PPC concept and then links related to that particular concept.

Another important thing to remember is that we will be discussing PPC in the context of Google’s AdWords platform. Most search engines use a similar terminology as well.