What is Search Engine Advertising?

  • Post last modified:10 August 2023
  • Reading time:32 mins read
  • Post category:Digital Marketing
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What is Search Engine Advertising?

Search Engine Advertising (SEA), also known as Search Engine Marketing (SEM) or Pay-Per-Click (PPC) advertising, is a form of online advertising that allows businesses to promote their products or services on search engine results pages. It involves bidding on specific keywords relevant to the business offerings, and when users search for those keywords, the advertisements appear at the top or bottom of the search results.

The Internet is an electronic network of computers that provides access to millions of websites, online banking, blogs, e-commerce, etc. It helps in accessing information on any topic. The Internet provides services, such as E-mail, File Transfer Protocol (FTP), internet banking and electronic commerce.

With the constant growth of the web, the Internet has become an indispensable part of billions of people’s daily life. People spend increasing time on social sites, such as Facebook, Twitter, Mobile application and on other digital communication technologies which induce marketers to communicate information about the products and services on the Internet in order to gain mass reach.

Also, the Internet is used to communicate or distribute information. The Internet is an ideal means to connect businesses to businesses (B2B), businesses to consumers (B2C) and consumers to consumers (C2C).

Search engine advertising is a major source of revenue for search engines, such as Google and Yahoo! Advertisements are displayed in response to a query in a separate result list on Search Engine Results Page (SERP). This is also known as paid search marketing.

When marketers place their ads along with organic search results on SERP by paying search engines on the basis of number of clicks on the ads, these ads are placed next to organic results. Google is the market leader in Search Engine Marketing (SEM) programmes.

Search engine advertising is the most credible technique to drive targeted traffic regularly to a website. One can easily measure the impact of the cost. It aids in knowing the type of audience that one can target by analysing their typical search pattern. The marketers can control the costs as well decide on budget and bids. It makes brands and products more visible by offering high rankings on SERP.

Now, the question arises if organic results are free, then why do marketers spend money on paid advertising? Although, a website can get a higher ranking even by building a brilliant website and by investing in SEO. Still, a website would not be able to reach the top of the SERP. Therefore, search engine ads are important as brands or marketers can secure a top position on search engines with the help of paid advertisements. Let us understand the significance of search engine advertising in detail.

Significance of Search Engine Advertising

Organisations consider buying search engine advertisements in order to capture the intent of users. It is also easy to execute and design a search engine advertising campaign at a controlled cost. Organisations consider buying search engine advertisements in order to capture the intent of users.

It is also easy to execute and design a search engine advertising campaign at a controlled cost.


In order to get an overwhelming number of leads, marketers have a huge interest in clicking ads by users. Search engines are used for gaining informational content and users find information about products and services prior to buying them.

Hence, search engines capture both intent and interest of the audience. Search engine ads are shown in response to a query. Therefore, ads are shown only when the intent of the users matches with the ad content. It offers benefits to both the users of search engines and advertisers because ad buyers are charged on the basis of the number of clicks and users get relevant content only.

Ease of action

These ads are clickable in nature. The ads provide a hyperlink to the brand’s Web page or landing page designed for the ads. Therefore, users can access relevant information or content on the website as Web pages have an easy navigational scheme and internal linking to various other pages on the website.

Controlled cost

Search engine ads are targeted and priced according to the context of the search queries. Advertisers have to pay a fee every time someone clicks on the ad (cost-per-click model).

Search engines do not charge for impressions, that is, when an ad is displayed on the search engines. Also no charges are levied on an advertiser for creating the ads.


When your competitors’ websites rank higher in organic results, the search engine advertising can do wonders for you as you can bid on ads and can appear on the top with paid advertising.

In fact, the company running successfully on the basis of SEO needs to advertise on search engines. If not, companies are providing an opportunity to their competitors to appear on the top with the help of paid ads.


Search engines aid in creating and downloading performance reports of the ads. It is easy to view the statistics using metrics, such as average cost per click, the number of clicks for each ad, click-through rates and ad spends to help in assessing the effectiveness of the campaign. Hence, search engine advertising provides quicker visibility and that too targeted on the basis of search patterns of users and keywords.

Overview of Google Ads

Google is the market leader of SEM and it is considered as the best platform to use for search engine ads. Advertisements posted on Google are known as Pay per Click (PPC) advertisements.

Google Ads is the marketplace where brands and marketers pay to get their website ranked at the top of a search results page, based on keywords and other targeting options. It is important to understand how Google Ads rank ads on SERPs.

Following are the factors that affect the Ad Ranking on Google Ads:

  • Bid: It refers to a maximum amount an advertiser is willing to pay for each click on the ad.

  • Impression: It is defined as the number of views of the ads. It is not action-based, but a mere showcase of ads on the user’s screen.

  • Landing page: It is a page on the website on which the visitor lands, which has been created for marketing or advertising campaign from Google Ads or similar other pages. This webpage has been specifically created to convert visitors of your website into potential leads. It is designed for a brand’s advertising or marketing.

  • Click-Through Rate (CTR): It refers to the number of times your ad has been clicked divided by the total number of impressions. It is also known as interaction rate.

  • Quality Score: It is the matching of the relevancy of content with the context of advertisements. Sync between the landing page and context of the advertisement is a must-have to obtain maximum Quality Score.

    The Quality Score range is 1 to 10. Website getting a 7-10 Quality Score is considered to be an excellent website. It is the relevancy score between keywords and content available on your landing page.

  • Budget: It refers to the maximum amount you are willing to spend on your campaign per day.

Google shows your ad to users who are interested in your products and services with the help of targeting functionality that plays a key role in understanding when and where to publish ads would be valuable.

This platform enables you to target the right people in the right place at the right time. Google algorithm factors that affect the Ad Ranking are keywords, location, demographic factor, etc. Google Ads allow the marketers to have a control on the budget. It is an effective platform to manage and monitor ads.

Google Ads provide two formats for ads display, one is textual and other is ad extensions that are visual enhancements, such as maps, videos and phone number included in the ads. Ad extensions provide additional information in an ad. It can increase clicks on ads by 15%.

Advertisers first need to create an account on Google Ads. Then, Google Ads are classified into three operations which are campaigns, ad groups and ads. Advertisers bid on the keywords or search terms and the one who wins the bid appears on the top of SERP.

Ad Placement and Ad Rank

Search engines place ads in a specific predefined area on SERP. For example, Google Ads are placed on top, side and bottom. Three to four ads can appear at the top of SERP. Google shows only those ads which have a high probability of getting clicks from users.

Let us understand the types of placement on SERP in detail.

  • Top: This is the prime location in SERP for ads positioning. Users generally click on links on the very first search result page, that too above the scroll. The real competition lies for the top-four position on the very first page as click rates are higher for higher ranking ads. Ads placed below have low click rates.

  • Side: Until 2015, Google Ads were placed on the side too. The side part of an SERP shows only paid ads and no organic results. Click rate is very low for ads placed at the side. Users naturally pay attention to the left-side ads which is the main section of the results rather than the results on the right side.

    Left-side ads are known as native ads as they are displayed along with organic results. Google has discontinued the placement of ads on sides as such ad placement hampers the users’ experience on mobile.

  • Bottom: When Ad Rank for an ad is lower than the threshold for the top position, ads are placed in the bottom area.

After understanding the Ads placement, let us gain insights into the concept of Ad Rank. Ad Rank is defined as the position at which an ad appears on the search engine result page. It involves the ranking of an ad whenever it goes up for bidding, based on the Quality Score and Cost-per-click bid.

Now the question arises, why Ad Rank is important for marketers. As you know, advertisers desire to get more clicks on their ads. Also, every advertiser wants to achieve higher ranking at low CPC. The only way possible to achieve it is to attain a high Quality Score for ads. Having the highest quality landing page and creating the best ads and enabling quality in every parameter can help in attaining high Ad Rank and lower CPC.

The Quality Score is affected by three components that are landing page, CTR and relevancy. Ad Rank includes Quality Score, maximum bid and ad format.

A landing page is any web page that a visitor can arrive at or “land” on. It is a standalone web page distinct from your main website that has been designed for a single focused objective.

This means that your landing page should have no global navigation to tie it to your primary website. The main reason for this is to limit the options available to your visitors, helping to guide them toward your intended conversion goal.

Let us analyse the factors that affect the Ad Rank in detail.

  • Quality Score: It is the score from 1 to 10 assigned by Google to a landing page or an ad for a keyword. Quality Score is impacted by various factors, such as landing page experience, High CTR and ad relevance.

  • Maximum Bid: It is the maximum amount that an advertiser is willing to pay for a keyword.

  • Ad Format: It is an additional feature in an ad, such as ad extension, that can impose a positive impact on CTR.

Creating the First Ad Campaign

You will study the process of creating a first ad campaign for a new start up brand, i.e., online fashion store. The organisation has planned to go for Google search advertising to gain a position on SERP.

You should start by creating a simple ad campaign for the online store. This fashion store launched an online portal with the name of ‘Fashion Hub’ to sell fashion clothes to buyers across Indian metros. Following are a few factors that need to be taken into consideration before creating a basic ad campaign:

Keyword Research

This is the basic concept to understand when starting an ad campaign. Keyword is the focal point to any search marketing campaign. A keyword is delineated as an abstraction of various search queries that have been accumulated and developed to support SEM bidding.

Hence, the digital marketer of ‘Fashion hub’ must bid on a broad keyword like ‘clothing’ so that his ad also appears on various combinations of search queries, such as ‘Premium clothing’ and ‘Fashion Clothing’. Keyword planner tool can be used for performing keyword research.

Campaign and Ad Groups

The next important thing to know is the alignment of target keywords grouped under ‘campaigns and ad groups’. In Google Ads, with a setup of an account in Google Ads search marketing tool, digital marketer will divide his marketing activities and efforts by grouping target keywords into logical Ad groups, which, in turn, form a part of multiple types of campaign.

The process of creating an ad campaign involves the setting of the overall marketing objectives, transforming them into logical campaigns and then developing multiple ad groups within each of them. Every ad campaign has ad groups and for every ad group, there are a chosen set of target keywords that help in executing search marketing campaigns.

Figure shows the relationship among ad campaigns, ad groups and keywords:


Figure shows the structure of ad campaigns that are delineated as every ad campaign has ad groups that contain relevant keywords which are involved in the ads. Relevant ad groups are generated under each ad campaign.

There are different ways in which ‘Fashion Hub’ online portal can have executed its campaign based on:

  • Clothes Pricing: Reasonable clothes, premium clothes, etc.
  • Target Market: Men clothing, women clothing, kids clothing, etc.
  • Geography: US brands, European brands, Indian brands, etc.

Apart from the above-mentioned ways, there could be several other ways the online clothing portal can create their high-level campaigns. In the following subsections, you will study the components of the ad campaign in detail.

One can start with Google Ad by creating an account on https://ads. google.com by signing in using your Gmail account. Advertisers can log in on Google Ads using their existing account details. An ad campaign comprised various ad groups.

It is important to know that each campaign has two or three ad groups. An ad group is a bundle of target keywords and ads. In an ad campaign, setting up the daily budget to decide the maximum daily expenditure possible for the campaign is important.

Practices for Creating Effective ADSO

Users click on the ads only when their intent of search query matches with the content of the ad. Ads that grab the attention of the viewers have high CTR. Following are a few tips to create Google Ads:

  • Emphasis on the Unique Selling Proposition (USP) of the business

  • Add various ad extensions, such as ‘Callout extension’ which allows the user to include additional descriptive text of 25 characters or ‘Call extension’ that allows the user to create a call by clicking on the extension itself

  • Create search engine ads on brand keywords that involve the site links along with description

  • Add active verbs in the Call-to-Action (CTA) button; for example, ‘order now’, ‘purchase’, ‘avail discount’, etc.

  • Add relevant keywords in the ad content and involve those keywords in the landing page content in order to get a higher Quality Score

  • Review the ads after a few days to assess the performance and take corrective actions accordingly as it is important to optimise the campaign based upon the performance of the ads.

The key area of the focus for marketers or advertisers in search engine advertising is keyword targeting, ad formats, ad extension, keyword insertions, bids adjustment, and conversion tracking in order to create more clickable ads.

Bidding is done for keywords that would be applied to all ads that are configured for that keyword by advertisers. A bid is the maximum amount spent by the advertiser on each ad. Google provides an option to set the maximum amount that will be spent on each ad. Generally, the buying model in search engine advertising is Cost-per-click (CPC) as advertisers pay only when they get traffic on their website.

An estimated bid amount is provided by search engines for each keyword. Google uses the second price-bidding model which implies the winner of the bid pays the amount bid by the second-highest bidder rather than the amount the winner has bid upon.

Following are the bidding strategies available in Google Ads which are as follows:

Automatic Bidding

This enables Google control to fix up your bid on keywords according to the maximum bid advertiser is ready to pay. Google assists you to get the maximum clicks on the daily budget for a campaign.

In this setting, Google Ads has full control over the individual CPC bids. It also provides an option to set a CPC bid limit that can help in controlling cost, but it limits the number of clicks on the ad as well.

Manual Bidding

This type of setting imposes total control over bids. Advertisers should explore various options to set their bid amount manually. It is good for new brands and marketers as they do not incur over expenses and firm control is facilitated. It provides liberty to modify the individual bidding of keywords as per the performance of the keywords.

Enhanced CPC

It is a Google Ads bidding strategy which provides 30% of control to Google to increase or decrease the bids. This strategy is best for conversion-focused advertisers.

On the basis of conversion-tracking data, CPC bids are increased or decreased automatically in order to drive more conversions. In the case of searches which are potential leads as per Google algorithms and anticipation, the bid will automatically increase by 30%.

These are the strategies available for advertisers to use Google Ads. Marketers choose to buy strategies according to the objectives of the campaign. The standard buying model of search engine advertising is CPC. Other options available are CPM and CPA.

Conversion Tracking and Performance Reports

It is important for marketers and brands to monitor their ad account regularly to assess the performance of the ads. Bidding is done every time a user makes a search query which may affect the performance of your ads. Also, modifications done by competitors in their pricing and keywords affect your ad campaign. It is important to keep a record of conversion tracking so as to know the low impressions and low CTR on the ads.

Low impressions show that users are unable to see your ads on search engines due to low rating keywords. In such a case, marketers need to change the keyword terms and the type of match. Next, once the number of impressions increases, the next thing to focus on is CTR because a low CTR will affect the Quality Score which can reduce the impressions over time.

Therefore, it is important to improve the CTR. Having a clear Call to-Action (CTA) button, using ‘callout extension’ that articulates the value proposition can help in increasing the CTR. Both impressions and CTR are important for an organisation’s website to drive traffic.

Also, performance reports are essential to measure the performance of the campaign, ad groups, keywords and ads. Google Ads provide a ‘Reports’ tab that can easily generate reports. These reports help advertisers in pausing or modifying ad campaigns with weak performance and invest more cost on high performing keywords or ads. It is important to check the performance regularly.

Following are a few important reports that can help advertisers know the performance of ads:

  • Auction Insights: This report offers the understanding of other players’ performance who are involved in the same auction as the brand involved. This report provides insight into impressions, Ad Rank and ad position, etc.

    It enables users to know their competitors, their average ad positions and how many times their ads have overlapped with them, etc., based on the sample data.

  • Search Terms: This report plays a pivotal role as it delineates the keywords that users typed on search engines that triggered their ads. It identifies the match type which may be a word, phrase or exactly the same.

    Adding such keywords that have high conversions or clicks helps an ad campaign attain success easily. One can easily identify negative keywords from this report.

Google Adsense

You have studied about Google Ads, which is an advertising platform to facilitate paid ads placement on search engines and other network sites, whereas there is another type of ad placement provided by Google Display Network which is known as Google AdSense.

Google AdSense is a revenue earning advertising model where publishers provide space on their website for ads. This platform easily manages the process of ads publishing on other websites.

It delivers Google Ads to an individual’s website. Google then pays to the website publisher for ads placement on the basis of clicks on ads or impressions. Both Costper-Click and Cost-per-Impression are available in Google AdSense.

What is Google Adsense?

Google AdSense is a free platform used by publishers or bloggers to earn money by displaying targeted Google Ads on their websites. Publishers show relevant and engaging ads on their website for their site’s visitors.

AdSense matches the content of the publisher’s website with the context of display ads. Generally, blogging websites provide informational and valuable content. Blogging websites offer banner ad space on websites for advertisement in order to earn revenue.

Such ads drive traffic to the advertiser’s website and the publisher or blogger gets a commission for every visitor or lead. Google AdSense is a major source of revenue for personal bloggers. Google AdSense uses contextual ads, i.e., it displays ads that are related to the website’s content.

How does It work?

Any website that possesses space for ads and provides relevant content to users has a potential for ad placement. Therefore, publishers can apply for Google AdSense account on www.AdSense.com.

Once the publisher’s website gets approval from Google, the publisher can log in to the AdSense interface and select the type of ad unit which can be textual, rich media or images, etc., to be displayed on the publisher’s website.

After all this process, an ad code will be generated that will be pasted on the website wherever the publisher wants to allot space for ad placement.

AdSense has three steps:

  • Offering your ad space for ad placement after getting approval from Google

  • Advertisers with the highest bid win and appear on your website

  • Google manages and handles the billing and publishers get paid by Google for the ads on the publishers’ website. Google makes sure that all the publishers receive their payment.

The process seems easy but the approval from Google to have an AdSense account is very challenging and people may fail to do so because of various reasons, some of which are as follows:

  • Lack of traffic on a website
  • Presence of quality content on websites
  • Low CTR of Ads
  • Lack of On-page SEO

Also, Google can deactivate your AdSense account in the case of manipulation done by publishers and such invalid clicks and impressions or by violating the Google algorithms such as plagiarism and placing ads on-site with copyright and adult content. Therefore, before applying to Google AdSense account, one needs to comply with the Google program policy. Google AdSense is one of the highest rated contextual ad networks.

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