Search Engine Advertising
What is it? How does it work? Why it’s so effective?

People use search engines to find solutions to their problems all the time.

One of the ways to offer your solutions is by using search engine advertising.

While SEO requires time, Search Engine Advertising (in short: SEA), enables you to save time and instantly show up in front of target consumers actively looking for goods and services similar to yours.

What is search engine advertising?

Search engine advertising allows you to directly display your text ads among the search engine results pages (SERPs) on various search engines, like Google, Bing, and Yahoo.

Marketers who use search engine advertising display their ads to users who are actively looking for particular keywords, making them so powerful.

Search engine advertising is highly effective because searchers usually reveal a lot about their goals in their search queries.

How does search engine advertising work?

Search engine advertising uses an auction-based approach to display ads.

Marketers place bids on specific terms related to their goods or service.

However, bids and clicks are different.

Just because you might bid $100 for a keyword phrase, does not mean you will be charged $100 for each ad click.

Also if you bid 100$ and your competitor bids 90$ for an ad click doesn’t mean your ad is going to be displayed above your competitor’s.

Search engines take multiple factors when deciding which ad to show in what position.

Search engines advertizing ranking factors graph

Keywords Research

Keyword research is the process of identifying and selecting the keywords that you want your business’s ads to appear.

These keywords should be related to your business’s products or services and should be chosen based on their relevance, search volume, and competitiveness.

A good keyword research strategy starts with a list of topics and themes related to your business.

I highly recommend using keyword research tools, such as Ahrefs, Semrush, KWfinder, or Google Ads Keyword Planner, to generate a list of relevant keywords based on these topics.

It’s important to consider the intent of the user when choosing keywords, as this can help you select keywords that are more likely to result in conversions.

4 types of user search intents

Navigational

The user searches for a specific website.


Example: BMW website

Informational

The user searches for information on a topic.


Example: What’s a good car?

Consideration

The user researches options for a product or service.


Example: BMW vs AUDI

Transactional

The user searches for a specific product or brand.


Example: Buy BMW M3

In addition to selecting the right keywords, it’s also important to use negative keywords to exclude irrelevant searches.

Negative keywords can help prevent your ad from being shown to people who are not interested in your products or services, which can save you money and improve the effectiveness of your search engine advertising campaign.

By conducting thorough keyword research, you can create targeted ads that reach the right audience and drive conversions.

Keyword match type

In search engine advertising, a keyword match type is a setting that determines how closely the search query needs to match the keyword for the ad to be displayed.

There are several different keyword match types:

Broad keyword match

Broad match is a keyword match type in search engine advertising that allows your ad to be shown for a wide range of related searches.

This is the default match type and is designed to increase the reach of your ads by showing them to a broader audience.

With broad match, your ad may be shown for searches that include variations of your keyword, as well as synonyms and related terms.

For example, if your keyword is “running shoes,” your ad may be shown for searches like “best running shoes,” “women’s running shoes,” or “running sneakers.”

NOTE: While broad matches can be useful for increasing the reach of your ads, they can also result in your ad being shown for irrelevant searches.

Fortunately, there is a way against irrelevant searches with negative keywords.

Broad match modifier

With a broad match modifier, you can specify one or more words in your keyword that must appear in the search query for your ad to be shown.

These words are called “modifiers,” and you can use them to further refine the relevance of your ads.

For example, if your keyword is “running shoes,” and you add the modifier “best,” your ad may be shown for searches like “best running shoes for marathon training” or “best women’s running shoes with good arch support.”

Overall, broad match can be a useful tool for increasing the reach of your search engine advertising campaigns, but it’s important to carefully monitor your keywords and use negative keywords to ensure that your ads are being shown to the right audience.

Phrase keyword match

Phrase match is a keyword match type in search engine advertising that allows your ad to be shown for searches that include the exact phrase of your keyword, as well as close variations of that phrase.

This can be more targeted than a broad match but still allows for some flexibility in the search query.

With phrase match, your ad will only be shown for searches that include the exact phrase of your keyword, with additional words before or after the phrase.

For example, if your keyword is “running shoes,” your ad may be shown for searches like “best running shoes for marathon training” or “women’s running shoes with good arch support.”

To use phrase match, you’ll need to enclose your keyword in quotation marks when setting up your ad campaign. This tells the search engine to match the exact phrase of your keyword.

By using phrase match you will have more control and you can ensure that your ads are being shown to users who are specifically searching for the products or services that you offer.

Exact keyword match

Exact match allows your ad to be shown only for searches that exactly match the keyword, with no variations.

This is the most targeted match type and is designed to maximize the relevance of your ads by showing them to users who are specifically searching for the exact term you’ve chosen.

With exact match, your ad will only be shown for searches that exactly match the keyword, with no additional words before or after the keyword.

For example, if your keyword is “running shoes,” your ad will only be shown for searches like “running shoes,” and not for searches like “best running shoes” or “women’s running shoes.”

To use an exact match, you’ll need to enclose your keyword in square brackets when setting up your ad campaign. This tells the search engine to only show your ad for searches that exactly match the keyword.

An exact match can be a useful tool for targeting specific search queries and reaching a highly targeted audience in your search engine advertising campaigns.

However, it’s important to note that using exact matches may result in lower search volume and fewer impressions, as the search queries will be more specific.

Negative keyword match

With the negative keyword match type, you can exclude certain search queries from triggering your ad.

This can help prevent your ad from being shown to users who are not interested in your products or services, which can save you money and improve the effectiveness of your ad campaigns.

Negative keywords work by telling the search engine not to show your ad for searches that include the negative keyword.

For example, if you sell running shoes and you don’t sell soccer cleats, you might use “soccer cleats” as a negative keyword to prevent your ad from being shown for searches related to soccer cleats.

How to set up keyword match types?

You can specify the match type when creating your ad campaign, this can typically be done through the ad platform’s campaign settings or through the keyword settings within your ad group.

The specific process for setting up keyword match types will vary depending on the ad platform you’re using.

However, in general, you’ll need to follow these steps:

KeywordMatch TypeExample Search Query
running shoesBroad matchbest running shoes for marathon training
running shoes +bestBroad modifierbest running shoes for marathon training
“running shoes”Phrase matchbest running shoes for marathon training
[running shoes]Exact matchrunning shoes
-soccer cleatsNegative keywordbest running shoes for marathon training

Bidding

Bidding refers to the process of setting the price that you’re willing to pay for each click on your ad.

This is typically done through a bidding system, where you specify the maximum amount you’re willing to pay per click (often referred to as cost per click or short: CPC) and the search engine uses that information to determine where to place your ad on the search engine results page (SERP).

There are several different bidding strategies that you can use in search engine advertising, including manual bidding, automatic bidding, and bid adjustments.

Manual bidding

Manual bidding allows you to set the maximum CPC manually, giving you complete control over your ad spend.

This can be useful if you have a specific budget in mind and want to have more control over your ad placements.

Automatic bidding

Automatic bidding, also known as smart bidding, allows the ad platform to automatically adjust your bid based on various factors, such as the relevance of your ad to the search query, the quality of your landing page, and the likelihood of a conversion.

This can be a convenient option for businesses that don’t have the time or resources to manage their bids manually.

Bid adjustments

Bid adjustments allow you to increase or decrease your bid for specific keywords, ad groups, or campaigns based on various factors, such as location, device type, or time of day.

This can be useful for targeting specific audiences or optimizing your ad spend.

The bid amount is not the only factor when displaying ads

As we mentioned earlier, just because you might bid $100 for a keyword phrase, does not mean you will be charged $100 for each ad click.

Also if you bid 100$ and your competitor bids 90$ for an ad click doesn’t mean your ad is going to be displayed above your competitor’s.

There are other factors that will affect the position of the ad.

Search engine ads structure

Search engine ads structure

The structure of search engine ads typically consists of a headline, a display URL, and one or more ad extensions.

These elements work together to create an effective ad that captures the attention of potential customers and encourages them to take action.

Headline

The headline is the main text of the ad and should be concise and attention-grabbing.

It should clearly communicate the value of your products or services and include a strong call-to-action (CTA).

It consists of 3 times 30 character texts.

Description text

The description text is the additional text that appears below the headline and provides more information about your products or services.

It should complement the headline and provide additional context or details that help to sell the value of your offering.

It consists of 2 times 90 character texts.

Display URL

The display URL is the web address that appears in the ad and should be relevant to the content of the ad. It should also be easy to read and remember.

Destination URL

The destination URL is the actual web address where the user will be taken when they click on the ad.

It should be relevant to the content of the ad and lead to a landing page that provides a good user experience and encourages conversions.

Ad extensions

Ad extensions are additional pieces of information that can be included in your ad to provide additional context or value to the user.

Examples of ad extensions include site links, location information, phone numbers, and reviews.

Ad text and copywriting

The ad texts are the first thing user see.

It will help to convey the value of your products or services to potential customers and encourage them to take action.

The text and copy in your ad should be clear, concise, and compelling, and should highlight the benefits and features of your products or services.

It should also include a call-to-action (CTA) that encourages users to click on the ad and visit your website.

5 tips for writing effective ad text and copy include:

  1. Using action verbs and power words to grab the reader’s attention
  2. Focusing on the benefits of your products or services, rather than just listing features
  3. Using numbers and statistics to make your ad more credible
  4. Using emotional appeals to connect with your audience
  5. Keeping your ad text and copy concise and to the point

Landing page

The anatomy of a landing page

A landing page is a page on your website that users are taken to when they click on a search engine ad.

It’s important to have a well-designed landing page that provides a good user experience and helps to convert users into customers.

The purpose of a landing page is to provide information about your products or services and encourage users to take action, such as filling out a form, making a purchase, or signing up for a newsletter.

A landing page is an important component of search engine advertising and can have a significant impact on the success of your ad campaigns.

The relevancy of your landing page has a significant impact on how Google Ads determines your quality score.

The more closely your landing page matches the keywords you’ve selected, the higher your quality score will be.

The greater your quality score, the lower your cost per click will be and the higher your advertising will rank.

Quality Score

Quality score is a rating system used by search engines to evaluate the quality and relevance of your ads, keywords, and landing pages.

It’s an important factor in determining the position of your ad on the search engine results page (SERP) and can have a significant impact on the cost and effectiveness of your search engine advertising campaigns.

Quality score is typically based on several factors:

  • Relevance of your ad to the search query
  • Quality of your landing page
  • Historical performance of your ad

A higher quality score typically results in a lower cost per click (CPC) and a higher ad position, while a lower Quality Score can result in a higher CPC and a lower ad position.

To improve your quality score, you should focus on creating relevant and compelling ads, using relevant and targeted keywords, and having a high-quality landing page that provides a good user experience and encourages conversions.

Ad auctions in search engine adverting

Ad auctions are a key component of search engine advertising, as they determine which ads are shown to users and in what order they appear on the search engine results page (SERP).

Ad auctions are typically conducted in real-time, with advertisers bidding on keywords and the search engine using a combination of bid amount and ad quality to determine the ad placements.

The importance of ad auctions lies in the fact that they help to ensure that users are shown the most relevant and valuable ads for their search query.

Search engines are able to match users with the most relevant and highest-quality ads, which helps to improve the user experience and the overall effectiveness of search engine advertising.

Advertisers can participate in ad auctions by setting up ad campaigns and specifying the keywords and bid amount for their ads.

How does the ad auction works?

The search engine will consider several factors, including the bid amount, the relevance of the ad to the search query, the quality of the ad and landing page, and the historical performance of the ad.

Based on these factors, the search engine will determine the ad placements and the cost per click (CPC) for each ad.

A few examples of how the ad auction might work in practice include:

A user searches for “running shoes” and the search engine conducts an ad auction to determine which ads to show for that search query.

AdvertisersBidRelevance and ad QualityLanding page qualityHistorical performancePosition
Advertiser A$2.00LowMediumBelow Average3
Advertiser B$1.50HighMediumAbove average1
Advertiser C$1.00MediumHighAverage2

Based on the bid amount and other factors listed in the table above, the search engine determines that Advertiser B’s ad should be shown in the top position.

Advertiser C’s ad should be shown in the second position.

Advertiser A’s ad should be shown in the third position.

Search engine advertising cost in 2023

The cost of search engine advertising is typically based on a pay-per-click (PPC) model.

You pay each time someone clicks on your ad.

The cost per click (CPC) is determined by a combination of your bid, the Quality Score of your ad, and the competitiveness of the keyword you’re bidding on.

When setting up a search engine advertising campaign, you’ll need to specify the maximum CPC you’re willing to pay for each click on your ad.

This is known as your bid.

The higher your bid, the more likely your ad will be shown in a higher position on the search engine results page (SERP).

It’s important to balance your bid with your budget and the expected return on investment (ROI) of your ad campaign.

A higher Quality Score typically results in a lower CPC and a higher ad position.

While a lower Quality Score can result in a higher CPC and a lower ad position.

The competitiveness of the keyword you’re bidding on can also impact the CPC.

Keywords that are highly competitive, such as “running shoes” or “travel insurance,” may have higher CPCs due to the high demand for those terms.

CPC costs per industry

IndustryAverage CPC (Search)Average CPC (GDN)
Advocacy$1.43$0.62
Auto$2.46$0.58
B2B$3.33$0.79
Consumer Services$6.40$0.81
Dating & Personals$2.78$1.49
E-Commerce$1.16$0.45
Education$2.40$0.47
Employment Services$2.04$0.78
Finance & Insurance$3.44$0.86
Health & Medical$2.62$0.63
Home Goods$2.94$0.60
Industrial Services$2.56$0.54
Legal$6.75$0.72
Real Estate$2.37$0.75
Technology$3.80$0.51
Travel & Hospitality$1.53$0.44
Source: https://www.wordstream.com/blog/ws/2016/02/29/google-adwords-industry-benchmarks

Search engine advertising platforms

Google Search Ads

Google Ads is one of the most popular search engine advertising platforms.

It has a reach of over 90% of global internet users.

It allows businesses to create and run ads on Google search results pages, Google Maps, and various other websites and apps. This allows businesses to reach a large and diverse audience.

Google Ads offers a variety of targeting options, including location, language, device type, and interests. This allows businesses to fine-tune their targeting and reach the most relevant audience.

Measurement and tracking: Google Ads provides robust measurement and tracking tools, including Google Analytics, which allow businesses to track the performance of their ads and make data-driven decisions about their campaigns.

Bing Ads

Bing Ads is another popular search engine advertising platform, with a reach of approximately 30% of global internet users.

It allows businesses to create and run ads on Bing search results pages and various other websites and apps.

Bing Ads are cost-effective and tend to have lower CPCs compared to Google Ads, making it a cost-effective option for businesses.

Bing Ads allows businesses to target specific demographics, such as age, gender, and income level, which can be useful for reaching specific audience segments.

Integration with Microsoft products: Bing Ads is integrated with various Microsoft products, such as Microsoft Advertising, Microsoft Advertising Editor, and Microsoft Advertising Intelligence, which can be useful for businesses that use these tools.

Yahoo Ads

Yahoo Ads allows businesses to create and run ads on Yahoo search results pages, as well as various other websites and apps.

It has a reach of approximately 10% of global internet users.

Yahoo Ads allows businesses to target their ads based on various factors, such as location, language, device type, and interests, which can help to reach the most relevant audience.

Search engine advertising vs. search engine optimization

Search engine advertising allows businesses to reach potential customers through paid ads, while search engine optimization allows businesses to reach potential customers through organic (unpaid) search results.

Both search engine advertising and search engine optimization can be effective ways for businesses to reach potential customers, and many businesses use a combination of both approaches to maximize their online visibility and reach.

8 advantages of search engine advertising

1. Get ahead of every organic result

With SEA you can get ahead of every organic result.

Your ad can appear at the top of the search engine results page (SERP), even if your website doesn’t rank highly for the relevant search terms.

By appearing at the top of the SERP, your ad is more likely to be seen and clicked on by potential customers.

This can be particularly useful for businesses that are looking to drive traffic to their website and generate leads or sales.

2. Quick and easy implementation

One advantage of SEA is its quick and easy implementation.

This means that it’s relatively simple and straightforward to set up and run search engine advertising campaigns, compared to other forms of advertising.

To set up a search engine advertising campaign, you’ll typically need to create an account with a platform such as Google Ads or Bing Ads and create your ad using the provided tools and resources.

You’ll then need to specify your targeting options, such as the keywords you want to bid on and the locations you want to target and set your budget.

Once your ad is live, you’ll be able to track its performance and make adjustments as needed.

3. Control over user intent

One advantage of SEA is the ability to control user intent.

This means that you can target your ads to users who are actively searching for specific products or services, rather than just showing your ad to a general audience like in social media marketing.

By targeting your ads to users who are actively searching for specific products or services, you can increase the chances of reaching potential customers who are more likely to be interested in your offering.

This can be particularly useful for businesses that are looking to drive qualified traffic to their website and generate leads or sales.

Having control over user intent can help to increase the relevance and effectiveness of your ads.

4. Analytics

Most SEA platforms, such as Google Ads and Bing Ads, provide a range of analytics and tracking tools.

These analytics allow you to see how your ads are performing in terms of metrics such as clicks, impressions, conversions, and return on investment (ROI).

Which helps you to understand which ads are performing well and which may need to be adjusted or optimized.

By using analytics to track and measure the performance of your SEA campaigns you can make informed decisions about how to allocate your budget and optimize your campaigns for maximum effectiveness.

Tracking and measuring the performance of your search engine advertising using analytics is a major advantage that can help businesses to make data-driven decisions and optimize their campaigns for maximum ROI.

5. Fast results

SEA will start usually get results quite fast.

This means that you can start seeing traffic and conversions from your ads almost immediately after setting up your campaign.

6. Cost per acquisition – CPA

SEA platforms like Google Ads and Bing Ads

By tracking CPA you can understand the cost-effectiveness of your SEA campaigns and make data-driven decisions about how to optimize your campaigns for maximum ROI.

For example, if your CPA is too high, you may need to adjust your targeting, ad copy, or landing page to improve the conversion rate of your ads.

7. Warm leads

By targeting your ads to users who are actively searching for products or services related to your business, you can increase the chances of reaching potential customers who are already interested in what you have to offer.

This can be particularly useful for businesses that are looking to drive qualified traffic to their website and generate leads or sales.

8. Greater brand awareness

With SEA you can increase the visibility and reach of your business, as more people will be exposed to your ads and website.

This refers to the extent to which people are familiar with and recognize your brand.

The 3 key disadvantages of search engine advertising

1. Higher long-term cost

The ongoing cost of running search engine advertising campaigns can be higher than other forms of advertising, like SEO.

Businesses that are looking to advertise on a budget or that don’t have a large marketing budget to allocate to advertising efforts.

It’s important for businesses to carefully consider their budget and the expected ROI of their search engine advertising campaigns before committing to this type of advertising

2. High level of competition

One disadvantage of search engine advertising is the high level of competition.

This means that there are likely to be many other businesses advertising on the same search engine platforms and targeting similar keywords and audiences.

The high level of competition can make it more difficult for your ads to stand out and be noticed by potential customers.

It can also drive up the cost of running SEA campaigns, as you may need to bid more in order to win ad placements and reach your target audience.

3. Require advanced knowledge for a proper setup

SEA platforms offer quick and easy setups.

However, the campaigns can become overwhelmingly complicated quickly.

Setting up search engine advertising campaigns requires knowledge of topics such as keyword research, ad copywriting, targeting options, budget management, and tracking and analysis.

Without this knowledge, it can be difficult for businesses to create and optimize their campaigns for maximum effectiveness.

To get the best results from SEA campaigns, unfortunately, you will need a level of expertise and understanding of the platforms and tools involved.

Conclusion

In conclusion, search engine advertising is a powerful and effective way for businesses to reach potential customers and drive traffic and sales to their websites.

By placing ads on search engine results pages, businesses can reach users who are actively searching for products or services related to their business.

This can be particularly useful for businesses that are looking to drive qualified traffic and generate leads or sales.

Google Ads Case Study

See how our approach is providing SaaS business with 20+ leads per week at a cost of 25$ per lead

We are serious when we say our approach generates outstanding results.

We track everything, and that’s why we can confidently say that our digital marketing approach brings in hundreds of thousands of dollars in profit for our clients.

Want some proof?

No problem — Our work generated over 470 qualified leads for an 8-figure SaaS company.

Authors:

Website | + posts

Alex is a co-founder of a digital marketing agency. His specialty is in overall digital marketing strategy, social media advertising, search engine advertising, search engine optimization, and conversion rate optimization.

Co-Founder IQs.Digital – Digital Growth – Conversion Design – Head of Creatives at IQs Digital | Website | + posts

Milica Gubecka is a serial entrepreneur and co-founder of a digital marketing agency. She has been leading the design department for several years. Milica has good experience working directly in account management, both B2B and B2C. Her specialization is in creating beautiful creatives, high-converting landing pages, and practical UX solutions.


How useful was this post?

Click on a star to rate it!

Average rating 0 / 5. Vote count: 0

No votes so far! Be the first to rate this post.


,

You may also like

Leave a Reply

Your email address will not be published. Required fields are marked *