At BrandBizzTech – a registered Digital Marketing Training Institute and Agency in Jalandhar, we not only run campaigns for clients but also educate students and business owners about how Google Ads actually work.
Most people think Google Ads are only about who pays the highest amount. But the truth is – the highest bid does not always win. Google wants to show relevant ads to users, not just expensive ads. That’s why it runs an auction system every time a user searches something.
In this blog, let us take you step by step, from basic to advanced concepts, so you can understand how the Google Ads auction really works.
- If you are a business owner, knowing the process helps you save money and get better returns.
- If you are a student of digital marketing, this is a core concept you must understand.
- If you are planning to join a Digital Marketing Agency in Jalandhar, interviewers will expect you to explain this clearly.
Core Concept: Google Ads Auction
Whenever someone searches on Google, an auction takes place in microseconds. Multiple advertisers are competing for the same keyword, but Google doesn’t just pick the highest bid.
Instead, Google calculates an Ad Rank for each advertiser. The one with the best combination of bid + quality wins the top placement.
Six Factors That Decide Ad Rank
Google considers six important factors to calculate who gets the best position:
- Your Bid – The highest amount you are willing to pay per click.
- Quality of Google Ad Copy & Landing Page – Your ad copy should include relevant keywords, which must also appear on the landing page. User experience of the landing page and CTR (Click-Through Rate) also matter.
- Ad Rank Thresholds – Minimum quality standards you must cross to show up.
- Auction Competition – Number of competitors and their bids.
- Context of User’s Search – Location, device, time, previous searches.
- Impact of Ad Assets – Extensions like call buttons, sitelinks, images, etc.
👉 This means even if someone bids ₹200 and you bid ₹150, you can still win if your ad quality is better.
Example: Auction Between Advertisers
Suppose three advertisers are bidding for the keyword “Buy Shoes Online”:
Advertiser A: Bid ₹120, advertiser B: Bid ₹150, advertiser C: Bid ₹200
If Advertiser A has a high-quality ad and landing page, and Advertiser C has a weak ad, Google may give Advertiser A the first position at just ₹130-140, not the full ₹200.
👉 So, even if you set the highest bid, it does not guarantee that you will win the ad auction
Bid vs Budget – Know the Difference
Many beginners confuse bid with budget.
Bid = How much you are willing to pay per click. Example: ₹50 per click.
Budget = Total amount you want to spend per day. Example: ₹500 daily.
Google may recommend high budgets, but as a beginner or small business, you should start with a small daily budget and optimize slowly.
Bidding Strategies in Google Ads
To participate in the auction, you need to choose a bidding strategy. Some important ones are:
- Manual CPC (Cost per Click) – You control the bids directly.
- Enhanced CPC – Google adjusts your bid slightly to get more conversions.
- Target CPA (Cost per Acquisition) – You set a target cost for getting one customer.
ROAS (Return on Ad Spend) – Similar to Return on Investment (ROI). It shows how much benefit or revenue you generate after spending on ads. You can also set specific goals to measure how effectively those goals are being achieved.
Maximize Clicks – In this bidding strategy, Google aims to get the maximum possible clicks within your daily ad budget.
Key Terms You Must Know
- CTR (Click Through Rate): Number of clicks ÷ impressions × 100. Example: 10 clicks out of 100 impressions = 10% CTR.
- Ad Relevance – When a user types something in Google Search, the search term can have different meanings. Sometimes the user is looking to buy, and other times they only want information. For this reason, the ad shown to the user must match the user’s intent and be highly relevant.
- Quality Score of Ad – Google has a predefined set of parameters to rate ads on a scale of 1 to 10. This score depends on factors like Click-Through Rate (CTR), ad relevance, user experience, and landing page relevance. A higher quality score means better chances for your ad to perform well at lower costs.
- Ad Extensions/Assets- Extra information like call buttons, links, offers, which improve rankin
Why Quality Matters More Than Bid
Google wants users to have a good experience. That’s why it checks:
✅ Ad Copy: Keywords must match the user’s search.
✅ Landing Page: Should be fast, mobile-friendly, and relevant.
✅ CTR: Higher CTR means people find your ad useful.
👉 Better quality = lower cost per click + higher ranking.
Google Ads Auction Is Dynamic. The auction is not fixed. It changes with:
- Market conditions
- New competitors entering
- User behaviour shifts
- Seasonal trends
That’s why you must monitor and optimize your ads regularly.
Tips to Win in Google Ads Auction
- Write ad copy with strong keywords and clear benefits.
- Use all ad extensions (sitelinks, callouts, structured snippets).
- Improve landing page experience – fast loading, mobile-friendly, easy navigation.
- Start with smaller budgets and scale after testing.
- Track performance – CTR, CPC, conversions – and keep optimizing.
Why Choose a Digital Marketing Agency in Jalandhar?
At BrandBizzTech, we help small business owners and startups achieve the best results within their budget by running impactful Google Ad campaigns that deliver better ROI.
Students – learn practically how Google Ads auction works with live projects.
Whether you are looking for a Digital Marketing Agency in Jalandhar or want to join training for Google Ads, we can guide you in both ways.
Conclusion
Google Ads auction is not just about paying more. It is about being smarter – writing better ads, improving landing pages, and choosing the right bidding strategies.
We at BrandBizzTech, a leading Digital Marketing Agency and Training Institute in Jalandhar, have been serving clients for the past 5 years. With experience working with international clients across various industries, we specialize in delivering impactful results. Whether you want to grow your business with ads or learn how to manage them professionally, connect with us today.