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This post serves as an Google Ads Glossary. We’ll review the nomenclature and the basic concepts to master in order to get the best results in your campaigns.
Next, we offer a series of Google Ads-related terms that you will have to master to get the best performance out of your campaigns. This Google Ads glossary aims to help you know what you are talking about at all times so that you can best interpret the information that the metrics present to you.
Conversion
This is the objective of a campaign. When a user performs the action for which the account is designed a conversion takes place. The most common conversions (especially in dropshipping stores) are the purchase of a product or service. However, you can define more than one type of conversion in the same campaign: registering for a newsletter, downloading a PDF catalogue or downloading an app on your smartphone. A conversion could even be being followed on social networks.
Quality Score
When a user performs a google search, the algorithm gives each advertiser a score based on the bid, the relevance of the ad with respect to the user’s search and the target page. This is known as a quality score. Optimising this parameter and making your ads and target pages relevant to user searches is key to getting a good campaign performance.
One has to be very logical with regard to this. If someone is looking for a “cheap hotel in Paris” and you offer a €500 a night hotel, that person will never click on your ad. And if they do click, they’ll leave in a hurry as soon as they see the prices. Google is able to detect this and will give you a low quality score, as it also does if your landing page loads very slowly or has broken links. At the end of the day, Google is a search engine and is responsible for finding the best results for its users. You’ll therefore do better if you adapt yourself to what people are looking for, and will be penalised if you do the opposite.
Keywords
This is the list of words or search phrases that you are willing to pay for them to appear when searched for. These are usually the terms that your business’s potential customers would use to search for the products or services that you offer.
Keyword Matching
One of the properties of keywords is that one can set how strictly they will adhere to the terms searched for in a search engine. Matching can vary from “wide” to “exact”. When you set a broad match for a keyword, ads relating that keyword will also be displayed in Google when one searches for synonyms. If the match is set as exact, it will only be displayed when the Google user looks for exactly the same term you have defined as the keyword.
CTR (Click-Through Rate)/click percentage
This is the number of clicks received, divided by the total number of impressions that your keywords and ads have generated. If an ad or keyword has been shown 100 times (100 impressions) and clicked on it 3 times, the CTR will be 3%. So the higher our CTR, the better. It means the ad is working well.
CPC / CPA / CPM
These are terms relating to the bidding method being used and refer to the cost per click (CPC), cost per acquisition or conversion (CPA) and cost per thousand impressions (CPM). An Google Ads Bidding Glossary could be broader, but these are the basic terms to be mastered.
CPA is one of the most interesting. We derive this using a simple formula, as in the following example. If I invest €100 in an Google Ads campaign and only acquire one conversion, my Cost Per Acquisition will be €100. Instead, if with the same campaign of €100 I get two conversions, my CPA will be €50.
Once we know this, we will have to consider whether this CPA is profitable or not. In the event that each acquisition brings us a profit of €1000 for example, we could say that it’s profitable. However, if that person has only bought a product costing €15, we are clearly losing money and will have to rethink our campaign.
Conversion Percentage
This is the number of clicks divided by the number of conversions. If two users out of 100 who click on your ads complete a conversion, the percentage of conversions will be 2%. The higher the percentage, the better.
Landing page / destination URL
This is the page in your web domain where users who click on your Google Ads ad will go to or “land”.
Ad Extensions
If a user carries out a search which is closely related to what you are promoting, Google may allow you to add extra information to the ad you have written. These are ad extensions. There are several types (call, geographical location, websites) and they show additional information relevant to the user who is searching.
Media Position
Indicates which media position your ad appears in when displayed. The maximum is 1 and the lower the value that this metric has, the higher the ad will be displayed (preferred position).
Cost and Average Cost
This refers to the total cost in a given period, or the average cost per click of the keyword, ad group, or campaign being analysed. It is a monetary figure shown in the currency in which you have set up your Google Ads account.
Experiments
This is a feature that allows you to compare how certain changes would affect the performance of a campaign or ad group. This is what is known as A/B testing in other areas. This is a very useful tool to test changes without risking the entire budget, as you can configure the experiment so that is shows the desired percentage with respect to the original campaign or ad group.
Opportunities
These are suggestions that the Google Ads system itself works to improve the performance of the different campaigns and ad groups included in the account. It is advisable to look closely at these points, because they are automatically generated and do not always positively impact on performance. In fact, Google Ads is very likely to periodically recommend that you invest more money to obtain more profitability. Investing more is a possibility, but it is not always a good idea. Examine these opportunities very carefully!
By knowing these terms, you can get an idea of the trends your campaigns have. Knowing the system and the nomenclature used is a basic task when it comes to getting the best possible results with Google Ads. Remember, we have already covered what you need to do to set up Google Ads in other articles, and this will help you to remove the element of chance from the use of this tool.
