In a nutshell, Google Ads is Googles paid advertising product, one that allows you to spread the word of your business online to people searching for similar things. Every time you search for something on Google you will see a selection of ads at the top of the results, which should relate to what you were searching for. Those companies have paid for those ads to be there, so that people will notice you. Sound simple, right? Well, yes and no. There are a lot of nuances around how Google Ads works, and why it works for some businesses more than others.


The Basic Principles Of Google Ads

First let’s look at the basic principles of Google Ads. Essentially you pick some keywords that a searcher might use on Google, and then create an advert that will appear on the SERP (search engine results page) based on those key words. Of course, you’re probably not the only company wanting to show ads to the people who use that particular term – there will be many, many others. This is where the bidding mechanism comes in. Rival companies can bid for the same search term as you, and if you want your ad to appear at all you will need to bid against them. This is what’s called PPC, or Pay-Per-Click advertising.

However, it’s not just the highest bidder that wins the space. Google is crafty, and it takes a lot of other factors into account. The main 2 are your bid strategy and amounts, and your ad rank. These two things together help Google work out where to display your ad on the SERP, or whether to show it at all.


Ad Rank

Ad Rank is a metric used by Google to work out whether to show your ads, where to show them and how often. The best way to describe how it works is to actually look to Google themselves, who describe it as:

“Generally speaking, the ad with the highest Ad Rank gets to show in the top position and the ad with the second-highest Ad Rank gets to show in the second position (assuming the ads clear the relevant thresholds), and so on.”

Because of the way Ad Rank works, your monetary bid is really only one of the factors included in calculating your Ad Rank. There are 4 other key things Google looks at, which are:

  • The quality of your ads and landing page (which is reflected in your Quality Score).


  • The Ad Rank thresholds. This is a set of quality thresholds your ad needs to meet in order to display. If you don’t meet these, your ad isn’t eligible to be shown. These can depend on things like the topic and nature of the search, the location and even the type of device.


  • Search content, including the query, the time of the search, other ads and search results that will show on the page, and other user signals.


  • Ad extensions and other ad formats – other pieces of information you can attach to your ad to improve its chances of display.




Then of course, there is the bidding. This is a simple and yet complicated thing, and is the crux of how Google Ads works. Essentially, you pay Google Ads each time your ad is clicked on by a user. The price you’re willing to pay for each click is called the cost-per-click. You can pick a maximum bid amount, choose an automatic option, or go for one of the more sophisticated bidding options. There are dozens of different bidding strategies available for you to use depending on your budget, size and overall goal, and we go into detail about them all here and here in our 2-part series.

Google then has to examine all of that information for you and for everyone else bidding on those search terms, decide whether there will be an auction or not, hold that auction, work out which ad offers a mixture of highest maximum bid + quality score before it can finally serve that ad on the results page. That might sound like a very long and complicated process, but it only takes as long as someone typing the query into Google. Which is around 0.26 seconds.


All sound a bit confusing? Don’t worry, you’re not alone. While this is the basics of Google Ads, the truth is Google is a complex monster of a website, and there are thousands of things that you can do to influence your Ads success. And unless you’re a dedicated specialist, you probably don’t want to know what half of them are. But at At-Extra, it’s our business to know, and to give your business the benefits of our knowledge and years of experience. If you would like to know more, just get in touch with the team today.