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Google Adwords in a nutshell

Google AdWords is Google's advertising platform, you basically choose a maximum bid price for search terms you want your ads to appear on and your bid will never exceed that. This advertising platform is an unparalleled advertising medium, and basically funds all of Google's ventures and is by far and large the number one contributor to Google's profits.

Within the service, there is a built in discounter, so often you average bid costs much less than your bid price. You can also specify geographic areas where you want your ad to appear, the pricing will change based on geo location.

Google's bid prices are not as clear to your competitors, so you do not have an easy way to see what your ads are costing.  Many times your actual price is lower than your maximum bid price, but on Google it is average click cost that matters and it is often far from your maximum bid.

AdWords Abilities

  • The sign up fee is only $5 and is converted into bid credits.
  • You can have your ads across Google's entire network of sites in under 10 minutes.
  • Google's broad match technology let you receive extremely broad distribution while it is still easy and fast.  Overture is beginning to do this as well.
  • Google's extensive distribution network allows you to test a business model without needing to invest fully into creating it.
  • You can turn the syndication feature on and off to determine whether or not you want AOL, or other network, users to see your message.
  • There is a content network of sites and you decide whether or not you want to advertise on them.
  • Google rolled out Geotargeting to help you target your ad to a certain geographic region.  Also, you can run multiple ads for the same words and then test them against one another or on different pages to A? B split test your ad copy.

High Clickthrough Rates are Important

Google lets its users decide the relevancy of ads and a price for Google AdWords is a function of price per click times click through rate.  Google calculates the average click through rate from the 1,000 most recent ads.  If you know how to get a high click through rate, you will dominate Google AdWords by serving up ads at a far cheaper rate than what your competitors are paying.

Distribution will produce more distribution.  In the beginning, you should overbid slightly as you will be competing against the best ads that have developed in your topic.  If your click through rate falls below a half a percent, Google will slowly choke the ads and suspend the ad group.

Google's bid price suggestions are often high and you might try cutting the suggestion in half when you first start.  Then, monitor them closely and change them to maintain or gain a decent ad position.

Exact, Broad, and Phrase Match

Google AdWords has various levels of word matching.  Using [search term] will only return results for the words search term.  Using "search term" will appear on any ad that has search term in the query and in the same order.  Using search term without the quotations or brackets will appear on any search that has the word search and the word term in it.  With broad matching, synonyms to the search phrase will also return results.  If you start off with broad matching, you should view the synonyms to make sure none of them are wasteful.  Here are some examples:

EXAMPLE TERM MATCH TYPE RESULTS SHOWN RESULTS NOT SHOWN
[drink milk] Exact Drink milk Any other search
"drink milk" Phrase Drink Milk, I love to Drink Milk, you Drink Milk Milk drink, or anything else that does not have both elements together and in that order.
Drink Milk Broad All above options and others such as: milk drinking, drank chocolate milk, etc….  

Keyword Sandbox

This is not the same thing as the SEO phenomena called the Google Sandbox.  The Google Keyword Sandbox displays what terms will be used for AdWords broad matching.  It will also suggest other keywords you may consider advertising for.  Unlike the other keyword suggestion tools, this tool does not offer search frequency.  To test search frequency, you should set up a bidding account for a specified term, but this can be costly if you are not targeting or bid too high.

In 2004 Google created a search term suggestion tool.  This automatically completes partial search queries.  If does not show search volumes, but it is believed that search volume plays a heavy role in its results.  The tool is currently only available in certain languages.

Negative Keyword Option

Google has a negative keyword option so that any word you do not want to appear for you can block.

Some of the words which would indicate a poor conversion rate are crack, free, pic, mp3, or download.  These are typically money pits.

The keyword list below shows a negative keyword, although it should be much longer and more detailed:

Drink Milk
Buy Milk
-free

Your ad would show up for many milk queries, but for none that included the words free.  Google also allows you to filter your negative keywords at the campaign level.

Dynamic Keyword Mapping

If you include your keywords in our copy you will increase your clickthrough rate.  Keywords that are in your ads will be highlighted by the search engine results display processing program.  This will draw more attention to your ad.

Currently, Google offers a tool that will place the active search word from your keyword list in the ad title automatically.  If you have a group of similar terms that will use the same body of text, you can enable this feature by writing out your normal body text and putting a {KeyWord: default keyword} in the title of the ad.

If the chosen keyword is larger than 25 characters, the default ad title will appear.  Otherwise, the ad will show the search term as if it were the ad title.  Note that the K and the W are capitalized, this makes the words in your ad title appear capitalized.  Additionally, you can put dynamic keyword mapping technology in the center of sentences, such as "Buy Cheap {KeyWord: default keyword}".

Account Feedback

When you open a Google AdWords account, you might be hesitant to spend a lot of money.  If you spend a small amount, you business will be ignoring Google's feedback loop.

You have to decide if it is better to lose $100 today or lose it over three months and come to the conclusion that you need a change.  Remember, not all industries make money from AdWords, it is not a business model that works well for everyone.

If you spend money on targeted keywords, you site has a fair chance for success.  Any great marketing internet based business needs a fast feedback loop to improve.  From the start, you will want to overspend on your ads in order to see which ones are most effective.  After a while, you can regroup your ad by price and then reduce your bid price.  An ineffective ad group or keyword will shut itself off, but you effective ads will keep appearing.

Advertising Professionals

Google has an Advertising Professional Program helps marketers to be certified as Google AdWords experts.  They require that you spend $1000 in a 90 day period after your sign up, comply with their rules, and pass their test.  After the 90 day period is over, you can put a logo on your site which will perhaps make people assume that Google endorses all of your SEO/ SEM services.

This program also lets you link together up to 500 AdWords accounts so you can access and manage them for one login.  Google has many online tutorials for free.  These can help you prepare for the test and learn more about AdWords.

Responsible Advertising

All of the features above, in addition to Google's free web based conversion tracking tool, result in a system that is a direct marketer's dream.  Everything is targetable, tangible, and measurable down to the last penny.

Google has a program called Google JumpState that helps you set up your account.  Likely they will not set up the best account, but they can help you get your feet wet.  The fee for JumpStart is converted into bid credit.