Long before internet marketing took off, the people behind Google recognized the search engine’s online marketing potential. Consequently, Google launched its own advertising service, dubbed “AdWords”, as early as October 2000. In 2012, this service generated $42.5 billion in advertising revenue.
Exactly how this service works can be a little tricky to explain, but suffice it to say that AdWords relies on search queries. Certain queries are deemed more important than others, based on how much value they command at Google’s “auctions”. Once a certain query gets entered, Google automatically displays relevant adverts on the search results page(s). The catch is that the adverts depend on their maximum bid and quality scores before they can be displayed.
Maximum bid refers to the largest monetary value given to a specific ad, based on how advertisers value the query or queries associated with it. Quality score, meanwhile, simply pertains to the relevance of the advert with the website it’s linking to and its overall appeal with internet users.
The advert with the highest bids and the top quality score becomes an AdWord and ends up in the first page of Google’s search results pages. Dealing with the bidding process and ensuring that the advert scores high in terms of quality are the responsibilities of advertising companies.