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Same Game, New Rules: Online Advertising with Google AdWords API

May 24th 2012 at 12:01 AM

You’ve probably heard over the grapevine something called Google AdWords API. Just three little letters and yet, it is a big thing to those who know what it means. But just before you’re told what API means, here’s a quick description of what AdWords is and how it works:

When you conduct a search on Google, you will find that along the listings on the results page are text ads. These ads are what Google calls AdWords. These ads are placed by businesses, which have signed on with Google on the AdWords program. The kinds of ads shown are relevant to the topic you looked up.

Google, however, does not charge for simply showing the ads. The advertiser will pay only when a Google user clicks on the ad. The cost per click (CPC) is determined via bidding where the advertisers value a keyword’s CPC depending on how popular and how often the keyword is used. Basically, the principle is that the more popular the keyword is, the higher the CPC becomes.

This setup has made it so that business, big and small alike, can conduct an effective and cost-efficient advertising campaign online. However, even good things can become better. And this is why Google has introduced AdWords API to its advertisers.

API stands for Application Programming Interface. But before you get intimidated with the term, think of it as simply a means by which Google allows its advertisers to manage their AdWords campaign with a lot more efficiency and flexibility.
Before API, Google advertisers had little to no control over the frequency, schedule, and location their ads are shown. That is not to say that the results are disappointing. In fact, there are a lot of satisfied advertisers who get impressive results with AdWords as is.

But there are some advertisers who would like to have a bigger hand on how, when and to whom are their ads are being shown and this is where API comes in.

Through the API, companies and businesses advertising on Google are given the opportunity to connect their own computer systems to Google’s (particularly the AdWords server). This allows the advertisers the ability to manage their text ads in matters like as delivery and pricing of their ads.

This ability may spell a huge change for Google. It will allow a change from a company that provides an online service to one that will be able to offer a venue for delivering ads all over the world.

Some experts even say it is not far removed now for the company to step into commercial transactions with the API. That means it may be possible that some day companies like eBay may find themselves competing against Google. (But that, of course, are speculations as of now.)

Currently, Google AdWords API is only available to its advertisers, excluding the Google AdSense affiliates. Initially, Adwords API benefits companies that already have in their employ personnel with the necessary technical skills to interact with the AdWords server. Programming skills, in particular, are required to do exactly that.

However, it is foreseen that in the near future the demand for this programming knowledge will create a market for a third party service that will be able to cater to companies who may not be able to have their own programmers but would still like to avail of the flexibility AdWords API offers.

So how exactly would an API benefit an advertiser?

If you’re at all familiar with how complex an online advertising campaign can get, you would know that it is typical for an advertiser to hold and conduct several campaigns at the same time. Managing this can be a complex and daunting task since each campaign can contain several AdWords, which in turn contains several keywords. It is not uncommon to find an advertiser needing to manage thousands of keywords at any given time.

Not only do you need to manage how the ads are delivered, you also need to know what campaigns work and which AdWords generate the most hits, which in turn reflects which keywords produce the best results. This is necessary so that an advertiser can focus his advertising budget to the keywords and campaigns that generates the most business.

Before API, doing that has been generally a straightjacket experience since the programs used to manage the ads are not customized to the business’ particular needs. What little information is generated is usually unable to answer specific questions each business asks to conduct an efficient campaign.

Google, having thousands of advertisers, cannot cater to each and every one. But to keep them happy, Google has allowed them access and the freedom to create programs to do what they want (within specific boundaries, of course).

Put in more layman’s terms, it is much like the owner of a restaurant allowing you the use of the kitchen and the staff to make your meal exactly the way you want it.

Applications that manage campaigns, report functions and track traffic are just some of the features developers can create for Google advertisers with the API.

Google AdWords API primarily uses SOAP (Simple Object Access Protocol), WDSL (Web Service Description Language) and SSL (Secure Server Location) as its core technologies. It currently supports Java, Perl, .NET, XML and PHP.

To protect overtaxing servers, a quota system is implemented. The quota limits the number of actions you can perform over Google’s servers for a given period. These actions are monitored by Google and if an advertiser feels that he needs an increased quota to manage his campaign more effectively, a request can be put through to Google for assessment.

The API also allows advertisers to create a system where multiple users can log into a single AdWords account to perform varied functions. The advertiser can then manage and set limits to the movements of their own staff when transacting with Google’s servers.

Google AdWords API is a big step not only for Google itself, but for its advertising partners as well. It introduces new rules that make for a more interesting playing field. The question of how far this innovation will take this industry can only be answered by the players themselves. Until then, the rest of the world will look on with much interest.

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