Google Ads: Definition, How It Works, & Example

What is Google Ads?

Google Ads is Google’s advertising platform that allows businesses to run paid ads. These can include, for example, text ads that appear above or below search results when a relevant search query is entered. In addition, Google Ads also includes image ads on partner websites, video ads on YouTube, product ads with images and prices, and ads in Google Maps.

At the outset, advertisers specify the search terms or target audiences for which their ads should appear, the total budget, and how much of that budget should be spent per day. Billing is typically on a per-click basis, so costs are incurred only when there is an actual response.

Where did Google Ads originate?

In 2000, Google launched its advertising program under the name AdWords. With a system that rewarded not only the bid but also the quality and relevance of the ad, Google broke new ground. In 2018, the advertising system was renamed Google Ads to reflect its expanded scope beyond pure search advertising.

Why is Google Ads important?

Anyone looking to advertise digitally can hardly avoid Google Ads. It provides immediate visibility across numerous platforms and a seemingly endless number of websites. The benefits lie in its speed and controllability. A campaign can launch today and be at the top of the rankings as early as tomorrow. You can instantly tap into demand, precisely control budgets, and accurately measure results.

These SEA ads are particularly valuable for bridging the gap until organic visibility is established. Otherwise, such top positions are nearly impossible to achieve at this speed through unpaid methods alone.

Advantages

Google Ads delivers immediate, precisely controllable visibility.
It offers full budget control and precise measurability of every euro spent.
Ads reach people at the moment they’re actively searching—meaning they have a high intent to purchase.
Campaigns can be adjusted, paused, or scaled at any time.

Challenges

Unlike organic visibility, visibility stops as soon as the budget runs out. In competitive industries, click prices can be high, so advertising is only worthwhile if order values are high enough.

And Google Ads is a complex landscape. Without in-depth knowledge of search terms, bids, ad design, and bidding strategies, you can quickly burn through your budget without seeing any results.

Example

A newly founded office cleaning service can’t be found on Google, and building organic visibility will take months. But through Google Ads, the company runs ads for search terms like “office cleaning Ulm.” It immediately appears at the top of the search results and starts winning its first customers.