Google AdWords is is an advertising service. Advertisements can appear in Google Search, on YouTube, and on Google Partner sites. Google AdWords provides an opportunity to be seen by potentially millions of interested customers.
Ads on the Google Display Network appear on websites that are relevant to your product or service. Ads can appear in text, image, mobile and video formats. YouTube is part of the Google Display Network, and the video ads shown there are Google AdWords ads.
The image above provides an example of where you might see Google AdWords ads on YouTube. Video ads have opportunities to play before or during YouTube videos (pointed out with a red arrow). Image ads that link to video ads can be shown in the right sidebar (boxed in red).
On YouTube, ads can also appear above search results, and in a sidebar to the right of the results.
How Google AdWords Works
The Ad Auction
Every time someone searches for something on Google, there is an opportunity for a relevant ad to be shown. Like search results, AdWords ads are ranked by Google in a competition to appear at the top of ad results. An ad’s rank depends on a few different factors; bid amount, ad quality, and ad format. All these factors are considered in the Ad Auction, which is an instant process that determines which ads will appear and in what order.
With a Google AdWords account, you are able to set how much money you are willing to pay for each click on your ad. This is called the bid. You are only charged when someone actually clicks on your ad and visits your website. This is known as pay-per-click advertising.
Businesses willing to pay more money per click than their competitors are favorably considered in the Ad Auction. Simply put, Google wants to make money like any other business. At the same time, Google wants to provide a great user experience for both the advertiser and consumer.
The best AdWords ads are highly relevant to the customer and are of a high quality. Google assigns a quality score to every ad. An ad’s quality score influences average cost-per-click as well as a number of other features. When an ad’s quality score drops, cost-per-click rises. Inversely, quality score rises, average cost-per-click drops! Therefore, it is actually possible to increase an ad’s return on investment (ROI) by strategically crafting high quality ads.
Using Google’s contextual technology, ads are placed among related online content to help interested consumers discover products and services. There are different ways in which you can communicate your message and stand out from the rest.
Text ads appear above and next to Google Search results. Text ads can also appear on relevant websites in the Google Display Network, like YouTube. For a complete list of Google AdWords ad format options, visit Google’s article on Ad formats available in an AdWord’s account.