How Does Google AdWords Work?

Google AdWords is an internet marketing platform developed by Google, in which advertisers bid on keywords to display short paid ads, service offers, product listings, and online videos. It can also place ads on other websites, online apps, and video. The system works by displaying relevant ads on a user’s desktop while the user is searching for information, performing a search, looking for a product, watching a video, or taking an online survey.

AdWords is not a pay per click program, although most advertisers will use words in that fashion to monetize their campaigns. Most pay per click programs that are available online to make use of PPC or Pay Per Click systems. PPC includes the costs for clicks, as well as the cost of having ads displayed on a variety of websites with varying ad rates. Google AdWords, however, does not use PPC but instead makes use of a contextual pricing system that will affect the price of any ad, depending upon the user’s search queries and other factors.

In order to optimize your adwords campaigns, you need to be able to determine how many people are actually going to click on the ads and when. Google AdWords uses data from statistics services to estimate how many clicks are done on a daily basis and how many people are likely to spend money on your advertised items. This estimation is based upon several different factors, including your ad’s relevancy, how relevant your ad is to the searched term, your placement on the search results page, your bid amount, the competition for keywords in your particular market, and many other factors. Since the number of clicks will determine your position in the search engine rankings, these calculations are critical to your success. The higher up you are on the rankings, the more people will be likely to visit your website.