I get asked all the time about Google Adwords. For the uninitiated, Adwords are the ads on the top and side of Google when you enter in a search. Entrepreneurs are always wanting to rank their website at the top of every search, but there are certain things that you need to know before getting started with Adwords.

So I decided to answer three of the questions I get asked the most -- all in one article. This won't answer every question you may have but this should be a good start.

1. There are three types of keywords.
In the online world, there are three types of keywords that consumers use when searching online that business owners need to keep in mind. First they do their research, then they compare products and then they search with the intent to purchase. For instance, this is the exact process I used to purchase my new Bluetooth wireless headset:

Research phrases: When someone is in the research phase, the person often has no idea what he or she wants, searching only for generic and simple terms. I started my search with "headsets." During this process, I learned that there are all kinds of different headsets: wireless, non-wireless, microphone, no microphone, etc. Notice, I have no idea what brand I want yet.

Comparison: As I peruse the search results for those generic terms, things start to get more specific. Not only am I reading reviews, but I'm pitting two products against each other. If you were in the comparison stage, you would most likely use terms like:

  • Beats vs Bose
  • Beats by Dre review
  • Beats pricing
  • Beats alternative

Related: 10 Common Google AdWords Mistakes You Need to Stop Making -- Now

I personally don't recommend that business owners purchase these types of phrases as I think they are a waste of your money. These types of phrases are used by people who are searching for an answer and are merely investigating a future purchase. If you're bidding on phrases like this, try stopping for a week and see if your profits rise.

Buyer: A customer often has his or her credit card sitting next to the keyboard as they are searching. That's why you need to come up with the right keywords that they are searching for. Most people know exactly what they want, just not where to find it. So they search. They will use specific keywords. You can always tell you have a "buyer keyword" when they use the following:

  • color
  • size
  • make
  • model
  • brand name

For example, as I read reviews of headsets, I finally found the one I wanted. It was made by Planatronics and called the Audio 995. I was ready to purchase and I entered into the Google search results the phrase "Planatronics Audio 995."

This is what I call buyer keywords. These are keyword phrases that people use with specific things about the product. If you know these keywords, you should be bidding on them as they usually lead to sales.

Related: How Google's New 'Paid & Search' Reports Can Provide Valuable Marketing Data

2. Try dynamic keyword insertion.
You can save time when you use dynamic keyword insertion. Rather than writing lots of ads, you can shortcut the process by putting {keyword} in the ad. It can be used in a number of different places:

  • The headline
  • The description lines
  • Display URL
  • Destination URL

Let's say you have 1,000 keywords and you don't want to write 1,000 different ads. All you have to do is add {keyword} and your desired keywords will appear. In most cases the keyword or keyword phrase the searcher just used while searching in Google.

In case you have a keyword that won't fit in the ad, you can set a default word. If your default word was banana, then you do the following: {keyword:banana}. There isn't a space between the colon and banana.

3. Ad position doesn't affect CTR.
Because I'm going to get a lot of slack for saying this, I want to make sure that you read this carefully. The range of ad position for the first page of Google is 1 to 11. I've found that click-through-rate (CTR) isn't affected by the ad position. Note that it doesn't affect quality score either.

3 Things You Probably Don't Know About Google Adwords

How can I make such a claim? Google bolds the keyword that is being searched for by a user. As you can see in the search above, I searched for "Insurance" and it's bolded in the picture.

User sees your ad and sees that it's relevant to them. The CTR will be the same, regardless of ad position. Make sure your keywords are in the ad somewhere, preferably the Title.

Related: Google Updates AdWords to Simplify Advertising Across Multiple Devices