How PPC works in Google Ads
When advertisers create an ad, they choose a set of keywords to target with that ad and place a bid on each keyword. So if you bid on the keyword “pet adoption,” you are telling Google you want your ad to appear for searches that match or are related to pet adoption (more on keyword match types here).
Google uses a set of formulas and an auction-style process to decide which ads get to appear for any one search. If your ad is entered into the auction, it will first give you a Quality Score from one to 10 based on your ad’s relevance to the keyword, your expected click-through rate, and landing page quality.
It will then multiply your Quality Score by your maximum bid (the most you’re willing to pay for a click on that ad) to determine your Ad Rank. The ads with the highest Ad Rank scores are the ones that show.
This system allows winning advertisers to reach potential customers at a cost that fits their budget. It’s essentially a kind of auction.