Google Adwords Dictionary

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There's a lot of "technical terms" used when talking about Pay Per Click advertising, so I've put together a PPC dictionary that explains what these things mean:

Ad group:

An ad group is a collection of keywords that have the same ad. Normally, a well-designed PPC campaign will divide its keywords into a number of different ad groups.

Clickthrough Rate (CTR):

Clickthrough rate (also known as CTR) is the number of clicks your ad gets divided by the number of impressions. CTR is normally expressed as a percentage. CTR is very important in Google Adwords as Google uses a pricing structure that's based on CTR x bid price. So, if you can raise your clickthrough rate, you can either lower your click cost or have your ad shown higher on the page.

Google Content Network:

The Google content network is the collective name given to all the websites that display Google ads. These ads are identified by the words "Ads by Google" and are often referred to as "Adsense".

Google Search Network:

The Google search network is the Google search engine plus the other search engines that display Google Adwords ads.

Impressions:

An impression occurs each time your ad is shown. So, if someone searches for something and your ad comes up, that's an impression. If someone is browsing a website and your ad shows as adsense, that's an impression ... even if your ad is at the bottom of the page and the surfer doesn't scroll down and see it.

Keywords:

A "keyword" is the word or phrase an advertiser bids on in a PPC campaign. For example, if I were an Estate Agent in Edinburgh, I might bid for the keyword "Estate Agent Edinburgh". Most campaigns will have many different keywords.

Minimum Bid Price:

For any keyword, Google will set a minimum amount you have to bid for your ad to be active. This minimum isn't a contant and will change from keyword to keyword and, also, from advertiser to advertiser. So, you might have to pay more to enter a market than your competitors (for more information, see "Quality Score").

Negative Keywords:

A negative Keyword is a related term that you don't want your ad to appear for. So, if you were selling Accounting software, you may want to use the word "free" as a negative keyword. By doing this, your ad won't show when someone searches for "free accounting software". And this will mean you won't be clicked on by someone who doesn't want to spend money. It also means, and this is very important in Google Adwords, that you waste impressions on the wrong people and reduce your clickthrough rate.

Quality Score:

Google uses a "quality score" to evaluate the relevancy of the ad, the keyword and the landing page/website. Quality scores can be "poor", "ok", "good" or "great". If the score is "poor", Google will often increase the minimum bid price for that advertiser.

Search Term:

A "search term" is the same as "keyword".

Split Testing:

Adwords allows you to test one ad against another. This means you can see which wording is most effective and profitable. Frequently you will find a small change can make a difference of as much as 20-40%. However, I've done split tests that have increased clickthrough by as much as 500%. Split testing is regarded as an essential tool by most Pay Per Click professionals.

Steve Gibson