Complete Beginner's Guide To Paid Search

Last updated


Daniel Wade


July 28, 2022

This article may contain affiliate links where we earn a commission from qualifying purchases.

Paid search is one of the most valuable tools available for brands and businesses that seek growth and profitability online. This form of online marketing helps you drive more qualified traffic to your website.

These are users who are further down the purchasing funnel and are more likely to convert into paying customers.

That being said, the paid search domain can be overwhelming, especially if you are new to it.

Paid search is a nuanced and sometimes complex form of advertising. If you don't know what you are doing, you can easily end up blowing through your marketing budget with nothing to show for it. For this reason, it is recommendable to enlist the services of a reputable advertising agency to handle your paid search campaigns on your behalf.

Nonetheless, here is a comprehensive beginner guide to paid search that will take you through the fundamentals and essentials of paid search advertising. If you are new to the world of paid search, this guide offers you a basic introduction and provides a fundamental comprehension on how to utilize paid search to acquire more leads and paying customers for your business.


Table of contents

What is Paid Search?

Paid search is a form of online advertising whereby you pay a certain amount to have your business website displayed on a search engine result page (SERP) when a user keys in specific keywords or phrases in the search engine. The SERP displays the ads you create in order to direct user traffic to your website.

Typically, the fee you pay is based on the click (cost per click) or views (cost per impression) of your ads. This form of advertising is also referred to as Pay-Per-Click (PPC) advertising. In simpler terms, you can pay in order to rank on sponsored search listings.

Both paid and organic listings will appear on search engine result pages. However, they will be displayed in different locations. For instance, Google, the most popular search engine by far, displays the paid listings at the top and bottom of the result pages.

If you are not ranking particularly well in organic rankings, PPC advertising is a great option. Paid search is a very powerful tool and asset that allows you to enhance your business's online presence. If you haven't invested in paid search, now is the time to do it because your competitors are definitely leveraging this valuable tool.

Why Should You Invest in Paid Search Advertising?

PPC advertising can have a major impact on your brand or business. There is a powerful case for paid search advertising in that it helps drive valuable traffic and revenue. This is ideally the main goal or purpose of any business venture. Below are some reasons why PPC advertising is important.

1. It Contributes Towards Your Business Goals

Realizing your business goals is one of the most compelling reasons to invest in PPC advertising. An effective PPC campaign will help you in achieving a great deal of your marketing and business goals. The business goals can range from lead generation and e-commerce sales to high-level brand exposure and thought leadership. The good thing about paid search is that you can track almost all types of conversion goals.

This means it is a valuable tool that enables you to align factors that drive traffic to your website to your end goals. Paid search can bolster many aspects of your sales funnel and the route that your leads take from engagement to become paying customers. You can set up PPC campaigns effectively regardless of your set of identified goals.

2. You Can Track and Measure Paid Search

If you run your paid search advertising through Google Ads (the best PPC marketing platform), you can easily measure and keep track of your efforts. You can do this by utilizing Google Analytics together with the Google Ads performance tracking tools. With PPC marketing, you can get insight into high-level ad performance metrics including clicks, impressions, and conversions. You can base all these metrics on your defined business goals.

This means that your PPC performance has no mystery. You can easily view the stats and analyze the performance of your campaigns. Measuring and tracking enables you to determine the type of traffic and results in your PPC campaigns are driving your budget. This benefit is in contrast to other types of advertising channels where the attribution of your budget to direct results is not clear.

3. Low Barrier to Entry

With PPC marketing, you can quickly get up and running with minor optimization. This is regardless of whether you are new to the paid search scene. Unlike SEO efforts that require a lot of attention and time, paid search offers you a chance to realize great traffic and positioning within a short period.

In addition, you have the choice of determining how much you are willing to spend to generate leads. You can get a start with the smallest of budgets and then scale as your PPC campaigns kick-off.

4. It Enables You to Reach a Wider Audience

When you compare PPC advertising to other channels like organic, social, or email, it offers the advantage of targeting users other than those already familiar with your brand. You are not limited to your customer lists and existing customers.

Paid search advertising allows you to cast a wider net in order to reach new prospects and customers. In addition, you complete most of the processes within the advertising platform. This includes research, campaign build-out, writing ads, and tracking key performance indicators (KPIs).

The Top Paid Search Advertising Networks

The right PPC advertising platform for you will depend on the nature of your business. No two PPC ad networks are exactly alike. This offers you the opportunity to realize significant reach to prospects across audiences and online behaviors. Nonetheless, an effective paid search advertising campaign is one that incorporates the following platforms:

1. Google Ads

Google Ads is the most widely used PPC ad network by far. This is due to the incredibly huge volume of searches users perform on Google search engine. Billions of searches happen each day on Google. There are also a large number of sites on Google Display Network (GDN).

According to Google, their ads appear on more than two million sites and more than 600,000 apps. This means that your ads can be displayed wherever your target audience is. With Google Ads, your text, video, image, or responsive ads can be placed on Google search engine, YouTube, Google Display Network, and mobile apps.

2. Bing Ads

The Bing search engine portion of desktop searches has grown significantly over the past decade. Bing Ads features tools that enable you to import Google Ads campaigns. This simplifies the process of getting started.

Microsoft can serve Yahoo search engine traffic, allow access to Linked in data and power voice searches. This affords you even more opportunities to reach out to a wider audience. With Bing Ads, you can place your text and responsive ads on search engines, quality partner sites, and the Edge browser.

3. Facebook Ads

More than two billion people use Facebook each month as the top social media platform. Facebook Ads allows for granular targeting with interests, demographics, and behaviors. You can display photos, video, canvas, carousel, and slideshow ads on Facebook, Messenger, Instagram, and Facebook Audience Network (mobile apps).

Other noteworthy paid search advertising networks include Yahoo Gemini, LinkedIn, Pinterest, AdRoll, and Twitter. For the purpose of this guide, we are choosing to focus mainly on the Google Ads program. As long as you understand Google Ads, you'll be in a great position to comprehend how other search platforms work because they have been set up in a similar manner.

How Does Paid Search Work?

A paid search advertising campaign typically comprises three key elements. These are keywords, the ads, and landing pages. You avail a list of keywords to Google. This tells the search engine giant to display your ads on their result pages when users search for those keywords.

You then create your ads to be displayed for those keywords. Your main goal is to ensure they are both relevant to the search query and enticing enough for users to click on the ads. When users click on your ads, your ads direct them to your landing pages.

The main goal of your landing pages should be to get your visitors to convert in some way. This can be by downloading an offer or purchasing your product. Basically, paid search advertising boils down to your management, matching, and optimization of these three elements. This is not an easy task as it is advisable to have PPC experts manage your paid search accounts.

Fundamental Aspects of Paid Search Advertising You Need To Know

1. Pay-Per-Click (PPC) Bidding

In PPC advertising you only pay when a user actually clicks on your ad. You don't pay to have your ad displayed on the platform or when someone rolls over your ad with the mouse. It is a much better form of advertising than paying per impression (CPM) since your ad may be displayed 10,000 times and only one person clicks on it.

Therefore, you pay for each click, and the responsibility to make use of the click to turn the user into a customer falls on you. It is worth noting that there is a cost per thousand impressions with Google. However, this makes sense only if you are trying to create awareness about your brand through "share of voice" campaigns. If you are just starting out and want to generate leads, PPC is the best option.

So which factors determine the amount you pay for each click? Google sets its prices through an auction-style bid called PPC bidding. For a certain keyword, there is a top bidder. For instance, a company bids $7 for a user to click on their ad. Then you have the next bidder at say $6.50 per click all the way down to the lowest bidder.

The lowest bidder may value a click on an ad for the same keyword at say $3.50. Now, you don't actually pay these prices for each ad click. Instead, Google uses the lowest bid as the price for least visible (and therefore least valuable) placing on the result page (usually the bottommost ad).

Google then prices each ad placing going up in value at an incremental dollar value higher. For this example, we can use a $0.5 incremental value, meaning the top bidder will end up paying $4 for a click, even though they bid at $7.

2. Quality Score

While your PPC bid plays a significant role in determining if Google will display your ad for a given keyword, there is another more important factor that influences the decision. That is your ad's Quality Score. Quality Score (QS) refers to Google's algorithm, which ranks each of your ads in order of relevancy.

Google wants to see to it that the ads displayed on their network are valuable and relevant to the search engine users. Therefore, if you seek to master PPC advertising, you must have a solid understanding of the Quality Score. Your Quality Scores have a great influence on the effectiveness and cost of your paid search campaigns.

Quality Score impacts the performance of your PPC ads as well as the amount of your pay per click. Google uses Quality Score multiplied by your maximum bid to determine where you will rank during the ad auction stage.

This means that if you have a great Quality Score, you can rank higher up in the result pages listings than another advertiser who bid higher than you. For this reason, one of your main paid search goals with regards to Google Ads should be to improve your Quality Scores. Some of the factors that determine your Quality Score include:

  • Your click-through rate (CTR)
  • Relevance of keywords to their ad groups
  • Quality and relevance of landing page
  • Relevance of ad text
  • Historical performance of your Google Ads account

Of course, there are several other factors that influence your ad Quality Scores. Google doesn't disclose how much each factor weighs in on your Quality Scores. However, it is well known that the most important aspects are your click-through rate. When more users click on your ad, it is an indication that your ad is helpful and relevant to Google Users. As such, Google rewards these ads with higher rankings and lower costs.

3. Click-Through Rate

Click-through rate (CTR) refers to the metric that measures the number of ad clicks per number of impressions. It is a percentage of the users who view your ad and then go on to click on it. You can see your CTR on the dashboard of your PPC account. Getting a high CTR is pivotal to your paid search success.

This is because it influences your Quality Score and the amount you pay per click. Therefore high CTRs will allow you to maintain your ad positions for a lower cost. In addition, having impressive CTRs means that your campaign is driving a sizable number of users to your offerings. However, there are instances when high CTRs are not beneficial for your business.

If a keyword is not exactly relevant to your business or doesn't generate leads, sales, and outreach gains, then a high CTR for that term is bad for your campaign. The reasons are clear. You will be paying for each unproductive click, generating a lot of ad spend.

Other times, you generate clicks on highly-priced keywords, which exhibit a poor ROI even if they convert. Therefore, your paid search goal should be to have high CTRs on keywords that are not only relevant but also affordable. This means targeting the right phrases or words and getting as many users to click on the ads.

4. Keywords

In paid search, everything begins with a keyword. When web users use Google or other search engines, they type keywords into the search box to look up products, services, content, or information. The organic and paid results Google returns are relevant to the terms in the search box.

If you want your ads displayed on that page, you must bid on the said keyword. In order to realize success in paid search, you need to ensure that you are bidding on the correct keywords. This process involves several aspects:

  • Paid Search Keyword Research - This involves utilizing keyword research tools alongside analytical data to create a list of keywords that are highly relevant to what you are offering. Your main goal here is to ensure visibility when users look up products or services relevant to your company.
  • Keyword Grouping and Organization - An effective PPC account exhibits keywords that are organized into smaller groups of highly related keywords.
  • Negative Keywords - Negative keywords offer a way to eliminate unwanted clicks. By setting negative keywords, you instruct Google not to display your ads for these keywords.
  • Keyword Bid Optimization - Your paid search advertising budget is limited. In order to maximize ROI, you need to focus on spending on high-performance keywords. This ensures that you did end up paying more than necessary.

5. Keyword Matching

When bidding on keywords, you can instruct Google on how restrictive their Ad network should be in matching your Google ads against relevant keywords or search queries. There are four keyword match types, based on the degree of restrictiveness:

  • Broad Match - Broad match is the default match type for keywords. Google matches your ad against the largest number of possible search queries. For instance, if you bid on the keyword "hardware", your ads may display when users type in longer phrases that include this word, such as Detroit hardware" or "best hardware store near me". Your ads could also be displayed for closely related queries such as "building tools".
  • Modified Broad match - Modified broad match allows you to tell Google to display your ads when the keyword is in the search query. This excludes closely related matches. If you bid on "hardware", only search queries with the word "hardware" will trigger your ad.
  • Phrase Match - With phrase matches, only the search queries with an entire phrase within it will trigger your ad (words must appear in the order).
  • Exact Match - This is the most restrictive match type. It instructs Google to match your ads to queries that are exactly similar to your keyword(word for word).

Broad match keywords allow you to cast a wider net and exhibit a higher number of clicks and impressions. However, these are usually less targeted clicks and less likely to convert. On the other hand, the more restrictive matches afford a lower number of clicks. However, the traffic is highly relevant and more qualified.

6. Ad Groups

Ad groups are an important part of paid search marketing. With effective ad groups, you can drive more traffic and leads to your site at reduced costs. Ad groups can also help you increase conversions on your business website. Essentially, an ad group serves as housing for your keywords in your PPC campaigns.

The structure of PPC advertising is such that you first create an account followed by an ad campaign. Your ad campaign is home to your ad groups. The components within the ad group include keywords, text ads, and landing pages. Ad groups allow you to organize your PPC accounts into meaningful hierarchies. Search engines look into your ad group organization to decide and determine certain factors such as:

  • The keywords that will activate your ads
  • What the ad will say when it runs
  • Where the user is taken when they click on the ad

With well-aligned ad groups, you decide who to advertise to and the things to say when you grab their attention. To ensure your ad groups that convert more and cost less, make sure they are integrated and consistent.

7. Text Ads

Highly targeted and compelling text ads can make or break your paid search campaigns. They are usually the first line of contact that prospects have with your website. Users look up something similar to your own business and your text ads show up in SERPs. Their decision to click either on your ad and visit your site banks on the effectiveness of your message and its relevance to their needs.

A paid search text ad is the first- touch and it is vital that you have it right. A well-written text ad increases your click-through rates, improves your Quality Score, and lowers your cost per action. The most essential thing to consider when writing your ad text is to ensure it is relevant to your products or services, to the users' intent(you can infer this keyword and the context) and to your paid search landing page.

A Typical text ad contains a headline, two lines of the description, and a display URL. You have a limited character count on every ad line. Therefore, there's an art to coining a catchy and compelling message. Ideally, your text ad should:

  • Communicate your USP (unique selling or value proposition). Why users should visit your website and benefit from what you are offering.
  • Have the relevant keyword at least once.
  • Contain an eye-catching Call-to-Action(CTA) that compels the user to take a certain action

The good news is that Google avails various tools to make your ads compelling. For instance, you can utilize Ad Extension to provide more additional links, location, email field, product images, or contact information.

Setting up a Google Ads Account

You are ready to set up a Google Ads account if you meet the following conditions:

  • You have a relevant and responsive website that is easy to navigate and well built.
  • You are ready to commit to paid search for the long haul
  • You are ready to dedicate extra resources to paid search
  • You want to generate awareness, increase online visibility, generate leads and make sales

Setting up your Google Ads account is a simple three steps process.

1. Sign Up for Google Ads

Navigate to the Google Ads homepage and then click the blue "Start Now" button. In order to get started, you will need a Gmail account. You can create a new one or use your existing one. Next, enter the details of your business, including a link to your site, on the following screen. Click on "Continue" to go to the next step.

2. Create a Google Ads Campaign

Until you have finished creating your campaign and Google approves your first ad, you won't be charged anything. The first step is deciding the amount you are comfortable spending in a day. Decide on a daily or lifetime budget (daily is recommended if you are starting out). Start with a comfortable budget and make the necessary changes as your paid search campaign kicks off.

The next step is deciding where you seek to advertise (location), the networks you seek to advertise on, and the keywords you see to target. Next, you must set a maximum CPC bid for your Google ad. This is the most you are willing to spend for a single click of your ad. Finally, you can write your first PPC ad.

3. Submit Billing Information

While Google Ads is a PPC platform, it doesn't require you to pay right after a user clicks on your ad. You can pay on an automatic payment system. Google Ads can charge you every 30 days or when you hit a preset threshold. If you prefer manual payments, that option is available.

Paid Search Management and Optimization

You have your paid search campaign ready to go. However, one of the most important parts of paid search advertising starts now. This crucial part of ongoing management and optimization. Fortunately, Google Ads provides a wide array of features and tools to help you track the performance of your campaigns. These features are available on your account dashboard.

You can also utilize other tools such as Google Analytics. Below are some ways that you can manage your PPC campaign performance tracking and optimization:

  • Determine the average cost-per-click for your keywords. You may adjust your bidding depending on the available competition and the average placing you seek to maintain.
  • Monitor the search term report constantly. Keywords are not search terms. View the terms that you appear for, the ones that aren't correct (use as negative keywords), and the ones you can target more specifically.
  • As you start, set up several ads to test the working variations. With gathered data, you can see the ads that have higher CTRs and impressive conversions rates. You can then pause the underperforming ads and build new variations to improve performance.
  • Compare your time on page, bounce rates, pages visited per session, and other on-site metrics with your other traffic channels (social, direct traffic, or organic search). Compare different campaigns and ad groups.
  • Analyze your performance according to the device. Do users that come from the desktop platform have better engagement, CTRs, and conversion rates? Or does the mobile platform perform better?
  • Ensure that you analyze the monthly performance reports availed through the Google Ads account dashboard.

What You Should Expect From Paid Search

The good thing about paid search advertising is that you can view what's going on. This allows you to properly measure results, almost in real-time, and optimize your PPC campaigns on the fly. Below are just some of the results you can expect with a well-executed paid search strategy:

  • Increased Leads and Sales- many businesses utilize paid search to drive high-quality traffic to their sites, with the aim of converting them to prospects or customers. For instance, if your business is a transactional e-commerce company, PPC advertising is among the best sources of new and recurrent business.
  • High Conversion Rates - Today's customers turn to the search engine when they are looking up products or services. Numerous online studies have shown that search engines help generate better-than-average conversion rates.
  • High Accountability, Minimal Guesswork - With paid search you don't work on assumptions. You have control over your ads, the costs, the keywords, the budgets. You can tweak any of these elements in order to optimize your PPC campaigns for maximum ROI. Paid search distinguishes itself from other mediums in this way.
  • High and Easy Scalability - An under-appreciated benefit of paid search is its scalability. If you spend $100 a day and make $1,000, you can choose to scale it up tomorrow.

After going through this guide, you should have a solid comprehension of the workings of paid search. You should also have a great foundation to create and run paid search campaigns for your business. All in all, once you have a running campaign, you have to track KPIs regularly and optimize where possible.

Ongoing management enables you to determine the ad variations and targeting tactics that drive qualified leads and subsequent conversions. The regular and sometimes complex tracking and optimization necessities for successful paid search campaigns are major reasons why outsourcing this crucial marketing function to an online advertising agency is a no brainer.

Complete Beginner's Guide To Paid Search


Daniel Wade

Daniel Wade

After working for multiple digital advertising agencies and managing hundreds of client accounts and spending millions of dollars via Google Ads, Facebook Ads, Native Ads and Direct Media Buying, I took things out on my own and started SparrowBoost. Now, my tight-knit team and I continue to get smarter and more efficient at running our own campaigns and we share our knowledge with you.

Learn more about SparrowBoost