Google AdWords is a three-layered structure wherein each account is associated with an email address. In other words, one email address can have only one AdWords account. (This has changed recently but let’s stick to this number as of now). Each AdWords account can have multiple campaigns and each campaign can have multiple ad groups.

A set of ads and keywords that are related to each other are housed under an Ad Group.

For instance, you are selling footwear for both men and women. You set two different campaigns, one for men’s footwear and the other for women’s footwear. Let’s name them Men Campaign and Women Campaign. You have casual footwear, sports footwear and formal footwear for both men and women. Now you create 3 ad groups based on these categories (casual, sports and formal) in both the campaigns. Let’s name these 6 ad groups as Men Casual, Men Sport, Men Formal, Women Casual, Women Sport and Women Formal.a