How does Google Adwords Work?

Most of the information online surrounding Google Adwords is full of jargon and leaves people more confused than when they had started. Luckily, I have written a blog post to explain it in the simplest way possible. This means you can look at your options and see if Google Adwords is right for you – helping your business climb the ranks and getting nearer to that coveted top spot on the first page.

How much does it cost?

This is the bit people get most confused about. Each ‘advert’ you make will be clicked on by a potential client searching for the product/service you are offering – every time it is clicked on, you are charged money. But how much money you want to spend for each click is up to you. Most people start with £1 per click, and see how this works out, as the advert collects data and shows you which words are being clicked on the most. You then gently increase this amount until you hit the sweet #1 spot. This is a REALLY ROUGH idea of how much it all costs, as it’s up to you how much you put into the pot for Google to spend for each day too. Imagine your advert is set to £1 per click, and you want to advertise 5 days a week during office hours. Imagine you also wanted to only spend £10 per day – this equates to 10 clicks on your advert a day. This then means you’ll spend £50 per week, or £200 per month. As you set how much you’d like to spend per day, when the pot runs out, your advert will disappear until the next day when the next daily budget is available again. This is the simplest way to understand how Google Adwords works – here is a breakdown of that information in a case study (prices vary):

Each click – £1 (example bid)
Daily Budget – £10 (10 clicks per day)
Cost Per Week: £50
Cost Per Month: £200

The only thing to consider is this… businesses with high competition – such as construction, removals and online shops etc – will have more competition online and will therefore have to factor in higher advertising budgets. For example, ‘Removals in London’ is such a highly searched keyword, that it currently costs between £5 and £7 per click, to get on the first page. This is because everyone is paying Google Adwords to get to that top spot, and keep ‘bidding’ against each other for the highest ranking. If you put £1 per click, but another company puts £1.20, Google puts them above you. If your business is another type with less competition or you want to target specific areas of the city (and not the whole) of London, your bids per click will not need to be as high. When you create an account, after a few weeks of running it, Google will tell you how much it ‘suggests’ you should pay per click to be on the front page. Google Adwords works – but it is not cheap.

What is a Bid?

So let’s go back to the idea of £1 per click. This ‘£1’ is also a cost set by you. So if you start at £1 per click, and see which position you end up on (maybe the 2nd/3rd page at the top/bottom for example), then you could increase this bid to £1.20 per click and see if you climb any higher. All of this is essentially trial and error. You shouldn’t ever leave a Google Adwords account set in stone and just running the same set of details for months on end. It’s always better if you go in and make a few tweaks like this a few times a month. That way you can see what is working and what isn’t. For example, bigger companies with large amounts of money might place a bid of £3 on their advert. This might push everyone who has bid UNDER that amount further DOWN the list. Here is another breakdown of the ‘bid’ concept, i.e. the cost per click you or any other company might set, to show you how this works with Google rankings:

Company A Bids £3.00 per click – 1st Place
Company B Bids £2.10 per click – 2nd Place
Company C Bids £1.80 per click – 3rd Place
Company D Bids £1.00 per click – 4th Place

Does this mean the bigger companies with more money always get higher in the search rankings?

If you do not have an endless budget to spend on Google Adwords, then you would need to be more specific with your keywords. Keywords are search terms that other people use to find a website within Google or any search engine. (But let’s face it, Google are King Of The Internet at the moment, so who cares about other search engines?). Now let’s imagine you’re a small music store in Notting Hill Gate. You can pop keywords in like ‘Music Shop London’, but generally you will disappear pages down below companies like Sony, Amazon and iTunes who are advertising their companies with lots of money. Instead of only considering ‘music’ and ‘London’ as your search terms, maybe you can think about what you specialise in, and what area of London you want to target? London is a very big place, and people who live here tend to shop local – nobody wants to travel to East London when they live in West. Smaller local shops generally have a small specialist area – perhaps you sell vintage records? So ‘vintage records London’ might get you part of the way there, and might well be a set of keywords that get you more hits (you are allowed as many keywords as you like, but keep them relevant or you’ll be wasting money on clicks that cost you for people who weren’t looking for what you are selling.) So if you are based in Notting Hill Gate, wouldn’t you also be better off using keywords such as ‘Record Shop Notting Hill Gate’ so somebody local can find you? Perhaps name other areas around you too? Perhaps ‘Record Shop West London’. Then the net should widen and you should think of other things you sell that people will specifically search for. For example, my sister wants a wardrobe, but the average online searcher is smarter than those 5 years ago. She might not type in ‘Wardobe London’. She might type in ‘Blue Distressed Wardrobe Harrow’. Most prospective clients these days are very specific in their searches, to save time hunting down said item/service but also to get to what they need more efficiently.


What can SimplySigns do for me

The Google Adwords account needs to be researched, set up, and activated. The dashboard can be very confusing for those who haven’t used it before, but luckily we are here to get it all up and running for you. Using keywords that have been researched from your main competitors, looking into location specific searches (i.e. all of the places in London or surrounding areas you’d prefer to work in) and setting up days/times to run the advert, we can create a functioning account for you and create an advert with impact. Your advert will need a punchy opening title, as well as perhaps an offer or discount to get the prospective customer buying into what you are selling. We can then attach relevant keywords to this, which will make your advert come up once the search terms are typed into Google. We will then ask you to come in for a meeting, so that we can provide a tutorial on how to manage your account, as once we have set up Adwords for you we provide you with full control. Here we can set up what times of day and also what days of the week your ad will run, what your price per click will start at, and explain what the results in the report mean. This means you can then easily keep track of how many times people are viewing your ads, how many have clicked on them, and even when you might need to stop them from time to time.

We only charge £200+VAT as a one off to research the keywords, set up a Google Adwords account, and provide the tutorial. Then you can really begin to see your website climbing the ranks.

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