How paid ads actually work
Imagine a school fair where every stall wants the best spot by the door. Ads work like that: businesses bid for the best spots in front of people, and the platform decides who gets them.
- On Meta, TikTok and Google, ads are placed through an auction. You set a budget and a goal; the platform decides when and to whom to show your ad.
- All three use a 3-level structure:
| Level | Meta (Facebook/Instagram) | TikTok | Google Ads |
|---|---|---|---|
| Top | Campaign (objective) | Campaign (objective) | Campaign (goal, budget) |
| Middle | Ad set (audience, budget, placement) | Ad group (audience, budget, placement) | Ad group (keywords) |
| Bottom | Ad (the creative) | Ad (the creative) | Ad (the text/creative) |
- On Google, cost-per-click (CPC) bidding means you pay only when someone clicks your ad.
- Paying for ads does not buy you a better spot in Google's free (organic) results. Google says it doesn't accept payment to crawl a site more often or rank it higher.
- Ads amplify what already works. A weak offer with a big budget usually just loses money faster.
- Write your goal in one sentence, for example: get 10 beginner lesson bookings.
- Know that the ad platform runs an auction: you set a budget and a goal, and it decides when and to whom to show your ad.
- Draw 3 boxes on paper: Campaign (goal), Ad set or ad group (who and where), Ad (what people see).
- Write what goes in each box for your goal.
- Before spending, ask: is my offer clear? A weak offer with a big budget only loses money faster.
- Check: you can explain the 3 levels using one platform of your choice.
Videos by other creators on YouTube, for reference. They are not made by or affiliated with The Future Market.
Read the video script
[Host] "Every ad you see won an auction a split second before you saw it."
[Text on screen: Campaign > Ad set > Ad] "Every platform uses three levels. Campaign is your goal. The middle level is who sees it and how much you spend. The ad is what they see."
[Screen: Google search results with the 'Sponsored' label] "On Google with cost-per-click bidding, you only pay when someone clicks."
[Host] "But ads only amplify. If your offer doesn't sell to friends, it won't sell to strangers."
Before spending anything, write: your offer, your price, who it's for, and what action you want (visit, sign-up, purchase).
ClaudeStuck? Copy a ready-made prompt for Claude
Copy this, open Claude, paste it, and Claude will walk you through the lesson step by step.
For a grown-up: Claude is for adults (18+). Copy this, paste it into Claude, and use the answer to explain the lesson to your child.
I'm learning "Paid Ads Basics: Meta, TikTok, Google" on The Future Market. Lesson 1: "How paid ads actually work". What the lesson teaches: - On Meta, TikTok and Google, ads are placed through an auction. You set a budget and a goal; the platform decides when and to whom to show your ad. - All three use a 3-level structure: - Level - Meta (Facebook/Instagram) - TikTok - Google Ads - Top - Campaign (objective) - Campaign (objective) - Campaign (goal, budget) - Middle - Ad set (audience, budget, placement) - Ad group (audience, budget, placement) - Ad group (keywords) - Bottom - Ad (the creative) - Ad (the creative) - Ad (the text/creative) - On Google, cost-per-click (CPC) bidding means you pay only when someone clicks your ad. The exercise I'm working on: Before spending anything, write: your offer, your price, who it's for, and what action you want (visit, sign-up, purchase). I'm stuck. Please: 1. Explain the main idea in plain, simple words with one everyday example. 2. Walk me through the exercise one small step at a time. Ask me what I've done so far before giving the next step. 3. Don't just give me the final answer. Help me do it myself, and check my work when I share it.
I'm a parent helping my child (about 8 years old) with a lesson called "How paid ads actually work" from the course "Paid Ads Basics: Meta, TikTok, Google". Here's what the lesson says: Imagine a school fair where every stall wants the best spot by the door. Ads work like that: businesses bid for the best spots in front of people, and the platform decides who gets them. The activity: Before spending anything, write: your offer, your price, who it's for, and what action you want (visit, sign-up, purchase). Please explain this so an 8-year-old understands: short sentences, a fun everyday example, and no hard words. Then give me 3 simple questions I can ask my child to check they understood, and a way to do the activity together, one tiny step at a time.
Sources
- Google Ads Help, Cost-per-click bidding: support.google.com/google-ads/answer/6336101
- Google Search Central, How Search works: developers.google.com/search/docs/fundamentals/how-search-works
- TikTok Ads Manager, About budgets (campaign and ad group levels): ads.tiktok.com/help/article/budget?lang=en
Meta ads (Facebook and Instagram)
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TikTok ads
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Google Search ads
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Budgets, testing and tracking
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Ad rules, with Canadian examples (education, not legal advice)
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Final project
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Quiz
What are the three levels of a Meta campaign?
Campaign, ad set, ad.
Name Meta's six campaign objectives.
Awareness, Traffic, Engagement, Leads, App promotion, Sales.
About how many optimization events per week does Meta's guide say an ad set needs to exit learning?
About 50.
TikTok's minimum daily budgets?
Campaign over $50; ad group over $20.
What three things make up Google's Quality Score?
Expected click-through rate, ad relevance, landing page experience.
Can you pay Google to rank higher in the free results?
No.
Which three UTM parameters does Google say to always include?
utm_source, utm_medium, utm_campaign.
You advertise "$40" but add a mandatory $10 booking fee at checkout. What's the problem?
That's drip pricing, treated as misleading in many countries.
Final exam
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Certificate
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