An ad group is a set of 2-3 text ads that target a themed group of keywords. These keywords include things such as a product or service that you want to highlight or your company name, depending on the focus of that group, and ensure that the ads appear on searches for which they would be relevant.
Within a given ad group, Google's machine learning will optimize to favor the ad that performs the best in any given situation. This helps you get the most out of your ad spend.
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