Google generates billions of dollars every year through it’s paid advertisements in the search results. Whenever a business or web site wants to rank at the top of the search results, they will need to pay Google every time someone clicks on those links. The end results is millions of advertisers, paying millions of dollars daily.
Anyone can start advertising within Google’s search results by setting up an account through Google Adwords. The process is pretty straight forward and easy. Add your web site, ad copy and the keywords you want to rank for. Depending on how many other advertisers are bidding on the same keywords, you may have to pay a higher or lower cost per click on your selected keywords.
In the “How Does the Adwords Auction Work” infographic below, you will learn everything you need to know about paid advertising within Google.
How Google Adwords Bidding System Works Infographic Summary
Google Adwords is a complex system, made easy for online advertisers. As an advertiser, you simply need to create an account, bid on keywords and you are good to go. However, the infographic above goes into much detail on how the backend system actually works.
- The most sought after and profitable keywords on Google are “insurance”, “loans”, “mortgage” and “attorney”.
- Google earns over $32.3 billion in advertising revenue every years.
- When someone searches for something on Google, Google looks at the AdWords advertisers pool and determines whether there will be an auction. If one or more advertisers are bidding on keywords that Google deems relevant to the search query, an auction is triggered. Google determines which ad will be shown based off their ad rank, cpc bid and quality score.
- As an advertiser, you would pay the minimum amount you can pay for the position you win if your ad is clicked on.
- Google also allows bidding methods other than CPC, such as CPM or CPA.
Infographic source: Wordstream