How Does Search Advertising Work?

Search advertising is a very effective marketing technique that helps to place ads in front of users who search for a specific product or service. These types of ads are usually displayed at the top of the page, above organic search results. When used correctly, these advertisements can provide a huge boost in traffic and conversions. So how do these ads work exactly? In this article, we will learn what search ads are and how to run them. We will also learn how search engines like Google rank these ads. Lastly, we will discuss some tips for how to make the most of your search engine advertising strategy. 

how do search ads work

What is Search Engine Advertising?

Search engine advertising (sometimes called paid search advertising or search engine marketing) is a marketing technique that displays online ads in search results. The companies who use this service pay a small fee each time a user clicks on their advertisement. What makes search ads unique from other display ads is that they are only shown to users who have searched for similar products or services. Search advertising is a very effective strategy because it places ads in front of exactly the right audience. Since it is based on the needs of the user (not just what they might want), this type of advertising can significantly help increase traffic and conversions. 

Which Platforms Offer Search Advertising?

Most search engines offer the opportunity to display ads in their search results. That being said, Google Ads remains the most popular choice. In fact, according to Statista, Google claimed over 87% of the global search market share in June 2021. During the same time frame, Bing only accounted for 5.56% and Yahoo only 2.71%. While Google dominates the market by a large margin, marketers can still make use of other types of search engine ads. Search engines with lower visibility often charge less for their ad campaigns. This kind of comprehensive strategy can take advantage of Google’s massive audience while balancing lower costs with engines like Bing or Yahoo.

How Do Search Ads Work?

The actual process of running search ads is pretty similar across all major search engines. However, since Google Ads are the most popular option, we will use them to learn how these ads work. Google determines the rankings of search engine ads using a “modified second-price auction system.” This system helps Google determine the cost that advertisers pay to run their ads. Instead of paying the full price, companies only need to pay enough to beat out their closest competitors. 

Does this mean that Google only sells ads to the highest bidder? Not exactly. If Google only sold ads to the high bidders, their search engines would be flooded with low-quality ads that didn’t match the search query. To improve the process for both advertisers and users, Google also takes into account an advertiser’s Ad Rank. 

how do ads work

What is an Ad Rank?

Ad Rank is an algorithm used to determine how high an advertisement ranks in search results (or whether it is shown at all). It also determines how much the ad will cost to run. There are multiple factors that determine Ad Rank. Keep in mind that your Ad Rank is recalculated each time your ad is eligible to appear. As a result, it can fluctuate based on the competitiveness of the auction, the search context, and your current ad quality.

The factors that Google takes into account when determining Ad Rank include:

  • Expected Click-Through-Rate (CTR): This is Google’s estimation of how likely it is that your ad will be clicked. When users click on an ad, Google saves this information and uses it to inform the rates for all future ads.
  • Landing Page Experience: Effective landing pages can help to increase your Ad Rank score. The best landing pages contain original, relevant and useful content. They are also easy to navigate and user friendly. These factors combine to help increase your ad ranking.
  • Ad Relevance: As you might expect, Google inspects the content of each ad and determines how relevant it is to the search query. The more relevant the content, the more likely it is that it will be shown. This helps to make sure that users get ads that better match their needs.
  • Ad Formats: Any time you enhance or change your ad’s format, it can have an effect on your ad’s overall impact. Google takes this into account when determining your Ad Rank. Format changes can include things like add-ons, extensions, or new pieces of information.

search engine advertising

Top Tips for Effective Search Engine Advertising

Always Run More Than One Ad

When running paid ads, you need to routinely check how your ads are performing. If you only run one ad at a time, you won’t have anything to compare it to. Besides having a high CTR, you’ll want to make sure that your ads are turning potential customers into leads and increasing conversions. When you run more than one ad at a time, you can see which one is bringing in more successful traffic. You can then use this information to guide your future ad campaigns. You can also use what you’ve learned from running these ads to build up your other marketing efforts, like SEO.

Know Which Keywords You Want and Which to Avoid

As with any part of your marketing plan, make sure to do your keyword research. Try to determine keywords that you are likely to rank for and test them out. You’ll also want to keep up with the most popular search phrases, as these can change over time. Just because your keyword is ranking now, doesn’t mean it will continue to stay at the top.

On the other hand, you should also keep an eye out for keywords to avoid. If you are using broad or phrase match types, there is a chance that your content could appear in irrelevant searches. Keep track of “negative keywords” that might cause this to happen and remove them from your ads.

Pay Attention to Match Type

Google uses match types to determine which types of searches will display your ads. Broad match will show your ad to anyone doing a Google search that includes your keyword, without considering any additional words or phrases. This will show your ad to the greatest number of people, but it could also backfire by attracting the wrong kind of traffic. Exact match, on the other hand, only shows your ad to users who search for your exact keywords. Lastly, there is Phrase match, which shows your ads to users who search for your exact keyword phrase, in the order it’s written. These last two options can be pretty restricting and may limit your ad’s reach. 

Once you’ve done your keyword research, you need to decide which match type will attract the most traffic. The best option for you will depend on your marketing budget and goals. Experiment and see what works best for you. 

search ads

Write Compelling Ad Copy

Other than relevant keywords, ad copy is the most important factor that decides whether or not a user clicks on your ad. Good ad content doesn’t have to be complicated. Keep your copy concise and simple, but make sure to include all the information that the user needs. Your ads should also be creative and interesting visually, but not look over-crowded. Basically, you want to let users know that you’ve got exactly what they’ve been searching for. Make a few different versions of your ad copy and see which option performs the best. You can also research your competitor’s ads to find touchpoints that you might be missing out on. 

Adjust Your Ads Seasonally

One tip that is often overlooked is to change up your ads based on the season. This is especially true if your products or services are seasonal themselves. If what you are selling is more in demand during a certain holiday, for example, then you may want to bump up your advertising budget a few months ahead of time. You can also add a countdown feature to your ads. During the Christmas season, online shoppers want to make sure that their gifts arrive before Christmas Eve. If you are marketing an e-commerce website, mention in your ads the amount of days left to get their items in time!

search advertising

Using Search Advertising to Target the Right Audience

Search advertising can be an extremely effective way to increase traffic and potential conversions. These highly-targeted ads can help to get your product or services in front of the users who are already searching for them. Putting in a little extra effort to create great ads can provide even better results. SEO Design Chicago offers custom Google Ads training courses for individuals, agencies, and businesses. These comprehensive training sessions can help give you the tools to create, develop, and optimize your own Google Ads Campaign.


  • What is search engine advertising?
  • How do search ads work?
  • What is a match type?
  • What is an ad rank?
  • How does Google determine ad rank?

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