GGR25: How Google Ads Works – A Comprehensive Guide for 2025

Welcome to my "Get Google Ready" series for 2025! Each year, I update my playlist to help you stay on top of the latest developments in Google Ads and ensure you’re implementing the best practices for setting up and optimizing your campaigns. Today, we’ll explore four essential concepts that are crucial for success with Google Ads in 2025.

How to Optimise Google Ads Campaigns in 2024

1. Understanding the Google Ads Auction System

One of the foundational concepts to grasp is that Google Ads operates on an auction system. Unlike traditional auctions—such as those for houses or on eBay—the highest bid doesn’t always secure the top position. Instead, Google uses a metric called Ad Rank to determine your ad's placement in the auction.

In recent updates, Google has refined how Ad Rank is calculated, now relying on six core factors. Understanding these factors is key to optimizing your campaigns effectively.

2. Comprehensive Targeting Beyond Keywords

The second critical aspect of Google Ads is that targeting goes beyond just keywords. You can target based on various criteria, including audiences, demographics, locations, devices, and content placements.

For example, if you’re marketing multivitamins designed for individuals over 40, you can precisely focus your campaigns on that demographic. Additionally, you can refine your targeting to reach regional customers living in towns away from major shopping centers. This level of targeted advertising can significantly enhance your campaign effectiveness.

With newer campaign types like Performance Max and Demand Gen, reviewing your content placements is crucial. Identify the best-performing websites, YouTube channels, and apps to ensure your ads reach the most relevant audience.

3. Strategic Budget Management at the Campaign Level

Another vital element of Google Ads is that budgets are managed at the campaign level. When planning your campaigns, consider how to allocate your budget effectively:

• Geographical Targeting: Segment your campaigns by country, state, or city to optimize performance and manage spending.
• Traffic Volume: Monitor how Google allocates spending. If certain high-volume search terms dominate your budget, consider separating your campaigns into different product or service categories.
• Profit Margins: Be strategic about the products you promote based on their profit margins. Higher-margin products may justify a higher cost per conversion.

While multiple campaigns can provide more control, simplicity can yield excellent results. Some of the most successful Google Ads accounts I manage operate with just one or two campaigns.

4. Leveraging Automated Bidding Strategies

The final key point to understand is the power of automated bidding strategies. Popular strategies like Maximize Conversions and Maximize Conversion Value enable Google to automatically adjust bids to enhance conversions and revenue.

However, a crucial tip is to avoid implementing these automated strategies within the first 90 days of your campaign. Focus instead on achieving at least 30 conversions within the first month and observing a stabilization in your results over a four-week period. This approach allows you to base your bidding strategy on actual performance data rather than expectations.

Conclusion

As we embark on this journey through Google Ads for 2025, keep these core concepts in mind. Building a systematic plan for optimizing your campaigns is essential for achieving success. Ensure you’re executing the right optimizations at the right times—30, 60, and 90 days into your campaigns.