The Secret Power of the AdWords Search Terms Report

By , January 15th, 2014 in PPC | 24 comments
AdWords Targeting - Katniss Everdeen
Katniss knows how to hit her target. So should PPC marketers. Image by Murray Close via Lionsgate.

AdWords is a hideous beast of an application, but it has one tremendously simple core principle:

The secret to success on AdWords is NOT getting your ads in front of the MOST people, it’s getting your ads in front of the RIGHT people.

In fact, AdWords has a feature built into it that’s designed specifically to reward you for showing your ads to fewer people. It’s called Quality Score.

The biggest component of Quality Score is Click-Through Rate (CTR) which is the percentage of people that click on your ad after seeing it.

In this post, I’m going to show you a super simple process for increasing your CTR, boosting your Quality Score and lowering your CPC (Cost-Per-Click) by using an AdWords feature most marketers have never even heard of.


Match types in 60 seconds

The simplest way to boost CTR is to target your ads more narrowly through better keyword targeting, and in order to do that you first have to understand match types.

When you create a search campaign in AdWords you choose “keywords” to bid on. Once you enter your keywords you can choose from one of 3 “match types”:

  1. Broad match – indicated by one or more words written without any other punctuation eg. ladies shoes
  2. Phrase match – indicated by one or more words written in double quotes eg. “ladies shoes”
  3. Exact match – indicated by one or more words written in square brackets eg. [ladies shoes]

When you bid on these “keywords” you’re really bidding for a place on the page of results that someone sees when they type a search into Google. These are called “search engine results pages” or SERPs.

If you bid on the broad match keyword “ladies shoes,” you’ll be bidding on the SERPs for tens of thousands of different search terms. For example:

  • ladies evening shoes
  • shoes for women
  • sling back pumps

If you bid on the phrase match keyword “ladies shoes”, you’ll be bidding on the SERPs for fewer different search terms, namely those that contain the phrase “ladies shoes” in that order and with nothing in between. For example:

  • ladies shoes petite sizes
  • cheap ladies shoes

but you will NOT be bidding on the SERPs for the terms:

  • ladies evening shoes
  • shoes for ladies

If you bid on the exact match keyword [ladies shoes] you’ll be bidding on the SERP for exactly one search term, namely:

  • ladies shoes

That’s how match types work. As you can see, your targeting becomes exponentially more narrow as you go from broad, to phrase to exact match.

Why broad match ruins your quality score

Broad match sounds great, right? You get to bid on heaps of different SERPs with no effort.

In reality, you end up bidding on SERPs for loads of queries which are only tangentially related to your business (or completely unrelated).

Every time someone sees one of your ads and doesn’t click, your click through rate goes down. This means your quality score for that keyword goes down, and you pay more per click.

At the same time there are people out there who will just click on anything without really determining if it’s relevant to them or not.

So not only are you getting a lower click through rate and higher cost per click, you’re wasting money on clicks from people who were never going to buy from you anyway.

The Search Terms Report to the rescue

Fortunately, AdWords has this neat feature called the search terms report. Most people I talk to, even if they have have been using AdWords for quite a long time, have NEVER looked at the search terms report and when they do, it blows their mind.

First, here’s how to get to your search terms report:

  1. Click “all online campaigns” on the left
  2. Click the keywords tab
  3. Choose “keyword details”
  4. Choose “all”
  5. Witness the fitness

Here is a screenshot demonstrating how to get there:


AdWords Targeting - Search Terms Report

These things you’re looking at are not “keywords”, they’re “search terms.” These are the search terms whose SERPs you’ve been bidding on with your keywords.

If you’re using broad match keywords you will see a range of irrelevant search terms in here. If you’re using phrase match you’ll see fewer irrelevant search terms, and if (hypothetically) you were bidding only on exact match keywords then you would only see search terms here that exactly matched your keywords.

So how can the Search Terms Report save my business?

There are two very simple things you can do to immediately improve your click-through rate (and thus quality score) and reduce your cost per click using the search terms report.

1. Put the best search terms into their own ad groups

Start by downloading your search terms report and opening it up in the spreadsheet application of your choice.

Now order in descending order by the impressions column (or conversions if you’re tracking them – if you’re not, you should be, but that’s a topic for another article).

For each of the search terms that are most relevant to your business and that have the most impressions, create a new ad group with exactly one keyword and one ad in it.

Got that? One ad group, one exact match keyword, one ad.

Use the search term in the headline of the ad (you may have to edit it a bit to make it fit or to make it grammatically correct) and try to include as many of the words from the search term in the rest of the ad.

Here is an annotated screenshot with an example from one of my own campaigns to sell my AdWords eBook:

AdWords Targeting - Ad Groups

Depending on how many search terms you have this can be pretty time consuming but it’s worth the investment.

2. Block unwanted SERPs with negative keywords

As you scroll down your search terms report, you’re going to see a bunch of search terms whose SERPs you obviously do not wish to appear on.

A classic example is people looking for “jobs” or “careers” in your industry.

Match types work just the same for negative keywords as they do for positive keywords, so for example if you see that you have a bunch of search terms like:

  • jobs selling ladies shoes
  • careers in ladies retail
  • ladies shoes sales jobs

You could choose to add 2 phrase match negative keywords:

  • “jobs”
  • “careers”

It’s also worth noting that you’ll sometimes want to use exact match negative keywords. A great example of this is the single word search term for whatever you sell.

If you sell ladies shoes, you’ll probably find that you get a lot of traffic from the search term [shoes] by itself, and it will typically have a terrible ROI.

You don’t want to block out any query that contains the word shoes, so you can’t use a phrase match negative keyword. In this case you’d block:

  • [shoes]

You should generally never use broad match negative keywords. If you do you’ll most likely end up throwing the baby out with the bathwater.

You can add negative keywords to ad groups, campaigns, or to negative keyword lists which you can re-use between multiple campaigns. Google’s own support documentation has good information on how to do this.

The Result

You don’t have to take my word for it. Below are 7 screenshots from different clients in different industries. Some are on very small budgets and some on very large ones.

They all show the same trend. As you go from broad match, to phrase match to exact match 3 things happen:

  1. CTR increases (the biggest component in Quality Score, remember)
  2. CPC decreases
  3. Position increases








In all cases we have done nothing more than target our ads better by analysing the search terms report: no copywriting voodoo, no hacks, no split testing, no magic. Just smarter keyword targeting.

– Iain Dooley

About The Author

Photo of Iain Dooley

Iain Dooley runs a full service digital marketing agency called Decal Marketing, which specializes in AdWords training. They can manage your campaigns or teach you how to find and dominate an AdWords niche for your business in just 3 hours. If you’d like to see a concrete, repeatable strategy to run your AdWords campaign you can buy his eBook “Your First 3 Months on AdWords.”
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  1. Jumping topics to intellectual property use rights, any thoughts on crediting Lions Gate Entertainment Inc. for the image of Jennifer Lawrence in the Hunger Games, a link to the copyright license granting use rights, etc?

  2. Jason says:

    Thank you Iain – very useful and downloading my report as I write this. I have one keyword/phrase per Ad Group with only Phrase and Exact match type. What it has shown up for me is the importance of negative keywords for phrases that I want to use but are not relevant to my business.

    Another long night again:)

    • Iain Dooley says:

      Hi Jason, glad it helped … but perhaps ignorance was bliss? It’s laborious work analysing the search terms report, but valuable :) Also if you started with phrase/exact (rather than broad) you might find that you’re missing out on some interesting opportunities that you hadn’t considered. I always start bidding on broad match and narrow things down using the search terms report. You can spend a little more money at the outset but in my opinion it’s worth it because it’s the most accurate form of keyword research you can get and you can find some gold nuggets in there. I split my campaigns up by match type to make it simple to move my budgets around between this type of “exploratory” spending on broad/phrase, and my focused spending on exact match.

  3. Adam Garnsey says:

    Negatives keyword match types work differently to normal keyword match types. Negative broad stops any queries containing the negative keyword but doesn’t ‘broad’ match to other keywords so it can be useful at times. For more information see

    • Iain Dooley says:

      Hi Adam, thanks for posting that. When training people how to use AdWords I found that the difference between broad match for positive and negative keywords shows the same level of “diminishing returns” in terms of the “value per confusion” ratio as modified broad (which I also ignore). After analysing a crap tonne of search terms reports I feel pretty comfortable in my opinion that the risks outweigh the benefits and it makes things much simpler to explain. But the truth is out there … so it’s good to have that linked in the comments for the uber curious.

  4. scottm78 says:

    Great post Iain – I read your book a few months back and this post made it all come flooding back must get a campaign started this week.

    • Iain Dooley says:

      Hello again, Scott! I remember you were focusing on a very challenging but interesting niche ;) Would love to hear about your progress. Remember: the best time to start an AdWords campaign was 10 years ago. The second best time is now!!

  5. Brad says:

    Great post.
    One quick question for you – I have been using this report to build out my exact/phrase terms and hopefully rebalance my account to have less of the volume coming from broad
    I often end up with the same terms, in multiple match types (so a single term that I bid on as broad, phrase and exact)
    How does Google determine which of those 3 terms to give the impression to? Will it favor the exact or phrase version as compared to the broad?

    • Iain Dooley says:

      Hey Brad, I explicitly block new phrase and exact match keywords that I add into their own ad groups using negative keyword lists.

      I have 3 negative keyword lists in my typical setup: General Exclusions, Phrase Match Exclusions and Exact Match Exclusions.

      General is where I put phrase or exact match negative keywords that are irrelevant to my business.

      Phrase is where I put phrase match negative keywords which I have added as their own ad groups.

      Exact is where I put exact match negative keywords which I have added as their own ad groups.

      I then apply them as follows:

      General Exclusions applies to the broad and phrase match campaigns.

      Phrase match exclusions applies to the broad match campaign only.

      Exact match exclusions applies to the broad and phrase match campaigns.

  6. Mark H says:

    Really sorry for asking this out of place question, but when I do the initial select all, I also see a lot of negative keywords I’d like to add. Except, I want to select the keywords in that master list and then do something like “Add to Negative List”..

    How come that’s not there? Or is it, and I’m blind?

    • Iain Dooley says:

      Hey Mark, I actually just download the search terms report and do all my sorting in a spreadsheet, then paste the results into my negative keyword lists:

      the problem with the “add as negative keyword” feature in AdWords is that it won’t ever give you a phrase match negative keyword, so I like to identify which search terms I wished to exclude (shown above as red rows) and then in a separate column put the negative keyword that I’d like to use in order to block that search term.

      I left a comment above explaining how I setup my negative keyword lists.

      • Mark H says:

        Thanks Iain!
        You are very kind to share that screenshot with us. Thank you again!

        And I must once again apologize to ask you a follow up question to that screenshot, I didn’t quite understand the column E (exact match). So you’re basically adding (or modifying) that keyword into an exact match? And you’re also adding an ad group called “Exact Match” that will have it’s own Ads?

        But more importantly what is the negative exact match list?

        • Iain Dooley says:

          Hey Mark,

          It’s useful to think about the distinction between a “keyword” and “search term”. A keyword can, depending on the match type used, be used to bid for a spot on more than one search engine results page (these are sometimes referred to as SERPs for short; basically a search term will have a page of results so “bidding for a place on a SERP” is just another way of saying “having a search term match a keyword you’re bidding on”).

          When you look in the search terms report, you’re looking at search terms for which your ads have been shown, and you get stats about clicks through and conversions.

          I take search terms that are relevant to my business and put them in their own ad groups, ie. one ad group, one exact match keyword, one ad. This means that I concentrate all my spending in super targeted ads.

          I also do this for phrase match, ie. if I notice that a particular phrase is being used by people, I can get better targeting by putting an ad group in with just that phrase match keyword. Even though a phrase match keyword will still match more than one search term, it’s far more targeted than broad match.

          When I add new phrase or exact match ad groups, I also add them as negative keywords to stop my campaigns from conflicting with each other.

          Take a look at this comment I made further up the page regarding how I setup my negative keyword lists:

          I should also note that my system for doing AdWords is laid out very simply with videos and detailed explanations in my eBook “Your First 3 Months on AdWords”:

          If you want to see exactly how I do things. This is actually my staff training manual: when I run PPC campaigns for my clients this is the exact process I use.

          • Mark H says:

            Thanks again Iain, I already started looking at your website but thanks for the mention.

            I totally forgot about the distinction of search terms and keywords before asking you the question. Duh, makes total sense now!

            My only remaining question now is, while it makes sense with what you’re doing … we get hit by Google’s limitations. Aren’t we supposed to have a limit of 50 ad groups per campaign or something? So basically, we’re limiting each campaign to 50 keywords and that’s it?

            • Iain Dooley says:

              50 ad groups per campaign!! Where did you hear that? I’ve got a client right now with 734 ad groups in the exact match campaign that we’re currently spending on.

              The only limitation is the character limits in the ad text. So you’ll find that you have a search term which is really long and won’t fit into the headline and you have to do a bit of fancy editing to create the most relevant headline possible.

              The interesting thing is that, in theory, you can just use dynamic keyword insertion to do this for you, but the combination of improvements you get by structuring your headline correctly even when the search term is not grammatically correct, and editing longer (but often highly valuable) search terms to fit into the headline intelligently, you can easily outperform the results you get using DKI alone.

  7. Sales and leads are a bonus when you get started with adwords – in the Discovery phase its all about gathering as much real-world market research data as fast and cost-effectively as possible.

    Then comes Optimisation, and when working, Expansion.

  8. Pranaya says:

    Hi Iain,

    Never knew about the search terms before (even though I have been doing adwords on and off for a while). Thanks for the insightful article. Quick question, as you create a separate ad group for each of these search terms, do you have to manually remove them from where (the current adgroup) they existed before?


    • Iain Dooley says:

      Hi Pranaya, yes you’re not alone! Many people I’ve spoken to have been using AdWords for quite a while but have never looked at the search terms report.

      See the comment I made above about using negative keyword lists to stop your campaigns from competing against each other:

      So remember there’s a difference between “keyword” and “search term”. As you identify valuable search terms and put them into their own ad groups, you block that search term from being matched on your broad and/or phrase match campaigns using negative keywords.

      If you *removed* the keyword from your broad match campaign you would be “throwing the baby out with the bathwater” because there might still be other profitable, related search terms that you would never discover.

  9. I’ve read so many articles on Adwords but yours answered many questions without the usual drivel.

    I was especially looking for guidance on which keywords type to set negative keywords as, so thank you for the article.

  10. Mark H says:


    I’ve returned to this post to tell you thanks a ton for this article!
    I’ve done most of what you’ve asked (except for the one keyword, one ad, one adgroup) and I’ve seen CTR shoot up and cpc go low!

    Just wanted to say thank you verrrrry much for this!
    I feel like an expert lol