Before jumping in and creating yourself an AdWords account, you should familiarise yourself with the terminology used in the interface.

The below are some of the most used terms in Paid Search. Understanding these and the relationship between them will really help you get a grasp of the advertising itself.

Max CPC: The most you are willing to pay for a click on your ad.

Impressions: The number of times your ad has been shown to users.

Cost per Click (CPC): The actual amount you pay per click. This is calculated by dividing the total cost by the number of clicks.

CPA: Cost per acquisition/action. This is calculated by dividing total cost by the number of actions taken. An action could be a sale or simply collecting an email address via an opt-in form on your website.

CTR: Click through rate shows how often users click on your ad. It is calculated as clicks/impressions X 100 and it is represented as a %. For example if your ad had 1000 impressions and 40 clicks you would have a CTR of 4%.

Keywords: The targeting criteria you are using. These are the search terms you bid on to show your ads against.

Search Query: The actual search term typed into the search bar.

Paid vs. Organic Search

It is important to know the anatomy of Google when you are running PPC ads. You should observe ads in your niche to identify useful terminology and extensions being used.

The below screenshot shows the difference between paid and organic placements:

As you can see the top results are Paid Advertisement, with organic results following below. The paid placements have the  image next to the display URL. Up to 4 paid advertisements can be shown at the top of the search results page.

Ad Rank

Ad rank is your ad position as determined by Google. Google uses the below formula to determine the rank of your ad.

Ad Rank = (Max CPC) X (Quality Score)

Where Quality score is made up of a combination of factors including:

  • Keyword relevance
  • Landing page experience
  • CTR
  • Historical ad performance
  • Ad relevance
  • Impact of ad extensions and other ad formats
  • Other factors

The ad rank is re-calculated each time your ad enters an auction and is eligible to appear.

By improving each of these factors and increasing your quality score you can increase your ad position whilst controlling your costs. This is a good way to boost ad position whilst maintaining the cost efficiency of your account.

How to Structure Your Account – Campaign Inspiration

When looking for inspiration for an account structure you should take a number of factors into consideration including:

  • Website structure: When creating your account andyou should be using your website structure as a guide to help you determine how your structure will come together. By following the structure of your website you can group your products/pages together easier, allowing you to increase the granularity of your account. Typically the more granular your account, the more relevant, which will improve your quality score and lower your costs.
  • Keyword relevance (not just volume): You can use Google’s Keyword Planner (free) to get an idea of the search volume surrounding the terms you are looking at targeting. You can also use it for keyword suggestions and ad group ideas. I would however, look at the relevance of the keyword to your product or service (not just the volume). You should be looking to build an account filled with highly relevant, targeted keywords.
  • Industry/competitor Insights: It is important to understand the industry you are operating in. What kinds of search results are displayed from search queries relevant to your business? What does the competition look like for these queries? Take a look at the structure of competitor advertisements and the terminology being used.
  • Seasonal Trends – You can use Google Trends (free) to have a look at search behaviour and identify any seasonal trends that may exist in your niche.

Account Structure


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Your account needs to be structured as per the above diagram. This will allow you to have the granularity which will bring your costs down over time.

By organising your account, campaigns, ad groups in the fashion you can easily manage budgets, implement optimisation strategies and improve your quality score.

Ad Group and Keyword Structure

Your ad groups and keywords should be as granular and tightly knit as possible. The below shows a possible list of keywords and how they would be organised into ad groups:

This is part of an actual campaign I was running for one of my niche sites. The main keyword I was looking to monetize and which had proven to bring in leads was ‘battery reconditioning’.

This was a generic campaign therefore it was expected to be slightly more expensive than if I was targeting branded terms (as branded terms are less competitive and more relevant).

As you can see, the core terms are in their own ad group and separated out from the other keywords; which are longer-tail in nature and are expected to bring in less volume.

Ad Text Specifications

The character limits for your ad copy are as follows:

Headline 1: 30 characters

Headline 2: 30 characters

Description: 80 characters

Display URL: Auto extracted from the Final URL (the landing page you provide)

Ad Copy

Using the above ad groups as an example you can see how you would write your ad copy to help boost your quality score. You want to be getting your core keywords in the headline and potentially in the description. This is a major factor in determining the quality score of your ads.

Keyword Match Types

Once you have your keyword list ready you must also decide which match types you are going to use in your targeting.

The different match types are as per the below:

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As you can see, the broader you go with your keyword targeting, the less control you have. I would recommend using both Broad Match Modified and Exact match keywords.

You will use the Broad Match Modified campaign as an exploratory tool, to pick up any keywords you may have missed. The Exact match campaign will be the most cost efficient. You would ideally want most of your traffic to become through this keyword match type.

Ad Components Explained

Besides the ordinary components of the ad copy in the above example (i.e. headlines, description and display URL), you can see a number of ad extensions being utilised:

Callouts: Allows you to include additional text with your search ads. In the above example, Dominoes is stating the ‘Quick Online Ordering’ and ‘Amazing Value’ aspects of their business. Another useful callout for an E-Commerce business could be ‘Free Shipping’. Callouts are extremely useful in providing addition information without using up the character limits of your headlines and description.

Structured Snippets: This extension will allow you to highlight specific aspects of your product or service. They help provide context on the nature and variety of your product. In the above screenshot, Dominoes is highlighting the ‘Types’ of pizzas they offer.

Sitelinks: Provides links to specific pages on your website beneath the text of your ads (in addition to the main landing page). This assists users in finding what they are looking for with just one click. Sitelinks are great for taking users to pages which may be relevant to their search query.

Ratings Extension: These extensions (as seen in the above screenshot) are automated extensions which will showcase advertisers with high ratings. They show below text ads and come from an aggregation of business reviews gathered by Google.

If you follow all of the above tips you should be well on your way to understanding the correct setup of an AdWords account. If you have any questions or would just like to say hello, feel free to reach out to me at [email protected].