If you don't know how the Google Ads marketing system works, you are missing an important part of digital marketing. 

About 80% of businesses use Google Ads for their Pay Per Click (PPC) campaigns. This is right because Google has 83.49% of the global search engine market.

The auction system is the core of this powerful advertising tool. It determines how the ads are displayed and the price.

Knowing this system is very important if you want to take advantage of Google's huge presence. But how do you learn about it?

_{In this blog, we will discuss the following:}

• What is the Google Marketing System?
• What is Google AdWords?
• 5 key components of the Google Ads marketing system
• The Google Ads network
• 4 delivery strategies and marketing information
• The future of the system Google Ads marketing

_{What is the Google Ads marketing system?}

Think of Google's advertising system as a marketplace where ads compete to be found.

When someone searches on Google, ads and keywords like marketing are included. Success in this bank is not about making more money, but getting a high-quality account that shows the relevance of your ad and the people's attention to it.

Google finds all ads related to what the user searched for. If an ad is not relevant to the site or is not approved, Google will ignore it.

Ads with higher quality scores will rank better even at lower prices, and the quality of the ad will increase with the amount of demand.

This system ensures that users see effective ads and get the best value for the advertiser's money. You can adjust your strategies using different offers and ad formats to make your campaigns more effective and efficient.

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_{What is Google AdWords?}

Google AdWords is a system from Google that allows companies to create and manage online ads. The main goal is to get more information about your products or services, which will lead to more sales and potential customers.

_{You can target your ads based on:}

• Keywords
• Demographics
• Interests

How often you run your ad depends on how it works with others. It helps businesses reach customers who may not be able to find them through traditional marketing.

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_{5 Key Features of the Google AdWords Auction System}

So, what does this auction system do? Here are some important points that you should know:

_{1.Ad Rank}

Ad rank determines where your ad appears on the search engine results page (SERP).

It is calculated as follows: ad rank = quality score × bid amount.

Consider this:

Here's a simple breakdown of the ad rank calculation for the three advertisers:

Advertiser A:: Bid Amount: $2, Quality Score: 8, Ad Rank Calculation: $2 × 8 = 16

Advertiser B: Bid Amount: $3 Quality Score: 5 Ad Rank Calculation: $3 × 5 = 15

Advertiser C: Bid Amount: $4 Quality Score: 4 Ad Rank Calculation: $4 × 4 = 16

Summary:

Advertiser A and Advertiser C both have an ad rank of 16, but Advertiser A achieved this rank with a lower bid because of a higher quality score.

Advertiser B, despite bidding more, ends up with a lower Ad Rank of 15 due to a lower Quality Score.

_{2.Quality Score}

This metric is used by Google to determine relevance and quality for your ads and Google's ad bids for brand keywords.

"Your quality score is based on three main factors: expected CTR, landing page experience, and ad relevance." 

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Here is how it works:

Expected CTR + Ad Importance + Landing Page Quality = Quality Score

1. Expected CTR: This is what Google expects of the likelihood that your ad will get clicked when shown to users for any particular keyword, using historical data, analytical, and performance.

2. Ad Relevance: This is a measure of how your ad corresponds to what a user has searched for. The more end-to-end value delivered by an ad against the search query, the higher it gets in results.

3. Quality of the landing page: Google checks if the content of the page on which your ad will be placed is relevant; the user experience; load time and transparency among others.

Each one of the factors is then rated as either "above average,"  "average," or even "below average."

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Example: I'm an advertiser promoting diamond ring for women.

In case the ad contains relevant keywords, such as "diamond ring for women," and the destination page contains various diamond rings, thus ensuring a good user experience with a high CTR story, the quality is likely to be high. On the other hand, if the landing page loads slowly, contains irrelevant content to that which the ad promises, or the ad itself is vague, the quality score will be lower.

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_3.Keywords

Choosing keywords is essential because it helps align your ad with user intent. Well-chosen keywords mean that your ad is more likely to reach an audience that is actively looking for what you have to offer.

For example, an auction for "affordable digital marketing agency" is targeting a more specific audience than a broad term like "digital marketing agency." More specific keywords lead to higher CTR and better conversion rates.

You can also use negative keywords, preventing your ads from appearing in irrelevant searches.

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_{4. Ad Format} 

Google Ads offers a variety of ad formats, each tailored to specific campaign objectives and audience engagement strategies.

This includes:

• Search Ads
• Display Ads
• Video Ads
• Shopping Ads
• App Ads

The choice of format should be consistent with the specific goals of your campaign, whether it's to drive sales, increase brand awareness, or promote app installs.

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_{5. Ad Relevence}

Highly relevant ads are more likely to achieve higher positions on the search results page, even if they bid lower than less relevant ads.

Google evaluates the relevance of ads by analyzing how Google Ads bids for brand keywords and ad content match what the user is looking for. If your ad closely matches the user's intent, Google considers it more relevant, which positively affects its Quality Score.

Google prioritizes the user experience, trying to show the most useful ads to Internet users.

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_{Google Ads Network}

We have discussed how the marketing system works in Google AdWords, but it is also important to know where these ads are and who is seeing them.

So, where can you find them? The answer is simple - almost everywhere! We will discuss it.

_{Search Network}

The Google Search Network is ideal for reaching users who are actively looking for specific data:

• Products
• Services
• Information

Including Google search results pages and other Google sites like Maps and Shopping and other search partners.

The ads here are text-based and appear alongside organic search results, making this network perfect for targeting targeted users, such as those ready to buy or seek special services.

Useful for generating conversions and direct response programs.

_{Display Network}

The Google Display Network consists of several channels, such as:

• Websites
• News sites
• Blogs
• Google sites such as Gmail and YouTube

This network of most fashion-related ads is great for building brand awareness and renewal. The strength of network traffic lies in its accessibility and ability to attract users to various online channels. This is especially useful for advanced marketing, where the goal is to generate revenue and build brand recognition.

_{Video Partners}

Google's video partners focus on YouTube and engage users through video content. Video content is a powerful tool for storytelling, brand promotion, and attracting audience attention by incorporating images and information.

Video ads are great for creating an emotional connection with your audience, communicating your brand, and leveraging YouTube's large user base. It is very useful for campaigns that aim to increase brand awareness and engagement.

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Shopping Ads

If you are an e-commerce business, sales ads are made for you.

Display your product listing in Google search and shopping results, with images, prices, and a direct link to the shopping page. This is a very effective way to drive sales for retailers with a clear and segmented product list.

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_{4 Bidding strategy and auction insights to get a better result}

The right Google Ads bidding strategy depends on your campaign goals, target audience, and what kind of engagement you are looking to drive. Each bid strategy has its strength and is designed to optimize the performance of the ads for specific objectives.

_{1. Conversion-Focused Smart Bidding:}

Smart bidding strategies are powered by advanced machine learning to get each auction conversion-ready. Such strategies would be ideal when one desires to drive sales or leads. The strategy adjusts the bids in real time with consideration for a great deal of signals in order to maximize conversion value or the number of conversions.

Important smart bidding strategies include the following:

• Target ROAS: This aims at increasing conversion value while targeting a specific ROAS.
• Target CPA—Cost Per Action: This is a pricing model of optimized conversions that targets a specified cost per action.
• Maximize Conversion Value: This will optimize the value of the conversions for the budget available.
• Maximize Conversions: This will ensure that your budget is spent to maximize conversions; there is no targeting of any CPA.
• ECPC—Enhanced CPC: These are manual bids that get adjusted for additional conversions.

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_{2. Click-Focused CPC Bidding}

This will be the ideal bid strategy to have if you want to generate maximum clicks on your website.

Google has two ways of programming your CPC bid for you:

• Maximize Clicks: An automated bid strategy that seeks to bring as many clicks as possible within a given budget.
• Manual CPC Bidding: One can set the maximum CPC bids at the ad group, keyword, or placement level. It facilitates the optimal distribution of budget to profitable keywords or ad placements.

_{3. Visibility}

Visibility-driven ads help to maximize how often your ad appears, charging based on impressions. This is particularly helpful for awareness-type branding campaigns.

These are three strategies for visibility-driven ads:

• Target impression share: This is targeting the placing of your ad at the top of the page or anywhere on the Google search results page.
• CPM (cost per thousand impressions): You are paying for impressions; that's a thousand times your ad is shown, suitable for YouTube or the Google Display Network.
• vCPM (viewable CPM): For ads aimed at raising awareness but not specifically getting clicks. You are charged for every 1,000 viewable ad impressions.

_{4. Views and interactions}

Google video campaigns use CPV (cost per view) bidding. With CPV bidding, you'll be charged for video views or interactions such as clicks on calls-to-action. This type of bidding is best for campaigns that encourage people to engage with your video content.

_{The future of the system Google Ads marketing}

The Google Ads Auction System has changed a lot since it was designed, and it will continue to grow with new features. Here are some of our predictions for next year and beyond:

_{The Continued Rise of AI}

Artificial intelligence has become a staple for many tech companies, including Google.

For example, Performance Max campaigns in Google Ads use sophisticated AI signals and machine learning to discover new audience segments and conversion opportunities​​.

Publishers also worry that the new Google Search Generative Experience—the AI-powered summaries at the very top of search engine results pages—will further siphon website traffic, opening new strategies on how to leverage SGE for better ad visibility.

_{More Automation}

Increasingly common are Google Ads automated bidding strategies. Each auction is set through machine learning that bids for the client. This strategy does not only bring efficiency but also campaign accuracy​.

There's a middle ground, however.

While this automation is going to save time and increase operational precision, it will also entail that the PPC manager refocuses his role in terms of bid strategy and creative aspects connected with ad campaigns​​.

_{Privacy and First-Party Data}

With third-party cookies becoming less in fashion, interest has shifted to first-party data. Google is rolling out capabilities like Customer Match, which help you realize enhanced value from your first-party data to drive richer engagement and ad relevance.

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_{Bring your ads to the next level with Pave Agency.}

You have everything you need to know regarding the Google Ads auction system. Use this blog as a guide in understanding ad auctions and how you can put to work our expert tips into making successful campaigns for your business.

Ready to take your ad performance to the next level? Let Pave Agency help. By combining creativity, expertise, and data-driven strategies at Pave, we will show customers how to drive even more traffic and conversions with their Google Ads campaigns.

Take your ads to new heights with Pave Agency Google Ads Service!