Google Ads


Google Ads, formerly known as Google AdWords, is an online advertising platform developed by Google, where advertisers bid to display brief digital advertisements, service offerings, product listings, and videos to web users. It can place ads in the results of search engines like Google Search, mobile apps, videos, and on non-search websites. Services are offered under a pay-per-click pricing model, and a cost-per-view pricing model.

History

Google launched AdWords in year 2000. Initially, Google itself would set up and manage advertisers' campaigns. Google then introduced a self-service AdWords portal for small businesses that wanted to manage their own campaigns.
In 2005, Google started a campaign management service known as "Jumpstart".
In January 2006 Google purchased the radio advertising company dMarc Broadcasting.
In 2007, Google acquired DoubleClick for $3.1 billion. The acquisition was strategically important for Google, providing access to DoubleClick's advanced ad-serving technology and established industry relationships. This deal, while "transforming Google into a powerhouse", later attracted antitrust scrutiny, raising questions about its impact on market competition and digital advertising dominance.
In 2008, Google launched the Google Online Marketing Challenge, an in-class academic exercise for tertiary students.
Google retired the DoubleClick and AdWords brands in 2018 to simplify entry points for advertisers and ad sellers. The core product was renamed Google Ads, providing access to inventory on Google Search, its YouTube video service, the Google Play app store, and AdSense website publisher partners.

Functionality

Google Ads' system is based partly on cookies and partly on keywords determined by advertisers. Google uses these characteristics to place advertising copy on pages that they think might be relevant. In 2023, Google introduced Topics API, which allows targeting ads based on browsing history stored in browser, to Google Chrome. Advertisers pay when users divert their browsing to click on the advertising copy. Adverts can be implemented locally, nationally, or internationally.
Google's text advertisements mimic what the average search result looks like on Google. Offering text-only search ads initially, Google unveiled "Showcase Shopping" ads in 2016. With this format, retailers can choose to have a series of product images that appear in search results related to various search queries and keywords. In May 2016, Google announced Expanded Text Ads, allowing 23% more text. Image ads in the display network can be one of the several different standardized sizes as designated by the Interactive Advertising Bureau.
Besides the Google search engine, advertisers also have the option of enabling their ads to show on Google's partner network, members of which receive a portion of the generated income.
In 2024, Google Ads introduced AI-powered tools, including the "Ads Power Pair" of Search and Performance Max, designed to improve campaign efficiency across Google channels. These tools leverage first-party data, machine learning, and automated asset creation to enhance bidding, targeting, and audience reach.
In 2025, Google launched AI-powered ad tools for Indian Marketer. Ad will appear in AI Overviews for Indian users. Google launches “Generated for you” feature in product studio which will automatically create brand aligned images and videos by analyzing merchant catalogs and trending campaign concepts.

Restrictions on ad content

The "family status" of an ad is set by a Google reviewer and indicates what "audiences the ad and website are appropriate for." This will change at what time, on which page, and in which country an ad can appear.
As of December 2010, Google AdWords decreased restrictions on sales of hard alcohol. It now allows ads that promote the sale of hard alcohol and liquor. This is an extension of a policy change that was made in December 2008, which permitted ads that promote the branding of hard alcohol and liquor.
From June 2007, Google banned AdWords adverts for student essay-writing services, a move which received positive feedback from universities. Google has a variety of specific keywords and categories that it prohibits that vary by type and country. For example, use of keywords for alcohol related products are prohibited in Thailand and Turkey; keywords for gambling and casinos are prohibited in Poland; keywords for abortion services are prohibited in Russia and Ukraine; and keywords for adult related services or products are prohibited worldwide as of June 2014.
In March 2020, at the beginning of the Coronavirus crisis, Google blocked all face masks keywords from being eligible for ad targeting as part of a policy to prevent companies from attempting to capitalize on the pandemic.

Conversion tracking

Google Ads introduced enhanced conversions to make conversion measurement more accurate.
In 2018, Bloomberg News reported that Google had paid millions of dollars to Mastercard for its users' credit card data for offline conversion tracking purposes. The deal had not been publicly announced.

Technology

Google developed a custom distributed Relational database known as Google Spanner specifically for the needs of the ad business. The interface offers Spreadsheet Editing, Search Query Reports, and conversion metrics.

Lawsuits

Google Ads have been the subject of lawsuits relating to Trademark Law, fraud, and click fraud.
Overture Services, Inc. sued Google for patent infringement in April 2002 in relation to the AdWords service. The suit was settled in 2004 after Yahoo! acquired Overture; Google agreed to issue 2.7 million shares of common stock to Yahoo! in exchange for a perpetual license under the patent.
In 2006, Google settled a click fraud lawsuit for US$90 million.
In March 2010, Google was involved with a trademark infringement case involving three French companies that own Louis Vuitton trademarks. The lawsuit concerned if Google was responsible for advertisers purchasing keywords that violate trademark infringement. Ultimately, the Court of Justice of the European Union ruled that AdWords is an "information society service" under EU laws and Google is not obligated to monitor everything that goes on AdWords and they're not liable for trademark misuse but they were required to act promptly to infringement notifications.
In May 2011, Google cancelled the AdWords advertisement purchased by a Dublin sex worker rights group named "Turn Off the Blue Light", claiming that it represented an "egregious violation" of company ad policy by "selling adult sexual services". However, TOBL is a nonprofit campaign for sex worker rights and is not advertising or selling adult sexual services. After TOBL members held a protest outside Google's European headquarters in Dublin and sent in written complaints, Google reviewed the group's website. Google found the website content to be advocating a political position and restored the AdWords advertisement.
In June 2012, Google rejected the Australian Sex Party's ads for AdWords and sponsored search results for the July 12 by-election for the state seat of Melbourne, saying the Australian Sex Party breached its rules which prevent solicitation of donations by a website that did not display tax exempt status. Although the Australian Sex Party amended its website to display tax deductibility information, Google continued to ban the ads. The ads were reinstated on election eve after it was reported in the media that the Australian Sex Party was considering suing Google. On September 13, 2012, the Australian Sex Party lodged formal complaints against Google with the US Department of Justice and the Australian competition watchdog, accusing Google of "unlawful interference in the conduct of a state election in Victoria with corrupt intent" in violation of the Foreign Corrupt Practices Act.
In December 2019, France fined Google €150 million for advertiser suspensions on Google Ads, arguing it had "abused its dominant position by adopting opaque and difficult to understand rules" which it was then free to "interpret and modify" at its own discretion.
In early 2022, Google suspended all ad sales in Russia in response to the ongoing invasion of Ukraine. Over 1,000 Russian businesses that had purchased pre-paid ads, which were neither delivered nor refunded, joined the bankruptcy proceedings of the Russian Google subsidiary.

Controversies

Trademarked keywords

Google has come under fire for allowing AdWords advertisers to bid on trademarked keywords. In 2004, Google started allowing advertisers to bid on a wide variety of search terms in the US and Canada, including trademarks of their competitors and in May 2008 expanded this policy to the UK and Ireland. Until 2023, advertisers were restricted from using other companies' trademarks in their advertisement text if the trademark has been registered with Advertising Legal Support team.
In some American jurisdictions, the use of a person's name as a keyword for advertising or trade purposes without the person's consent has raised Right to Privacy concerns.
In 2013, the Tenth Circuit Court of Appeals held in 1-800 Contacts, Inc. v. Lens.com, Inc. that online contact lens seller Lens.com did not commit trademark infringement when it purchased AdWords and other search advertisements using competitor 1-800 Contacts' federally registered 1800 CONTACTS trademark as a keyword. In August 2016, the Federal Trade Commission filed an administrative complaint against 1-800 Contacts alleging that its search advertising trademark enforcement practices have unreasonably restrained competition in violation of the FTC Act. 1-800 Contacts has denied all wrongdoing and is scheduled to appear before an FTC administrative law judge in April 2017.