When you write an ad for Google adwords, it is important to include the keywords in the text of the ad. So if a user types in ‘Motorola V8’ you want to ad to say ‘Motorola V8’ not ‘Mobile Phone’. This significantly improves your click-through rate.
- Google will put the keywords in bold making them stand out
- Having searched for ‘Motorola V8’ the user will scan the page for the phrase ‘Motorola V8’ and tend to ignore ads that do not have that phrase.
- It makes you look like you are more focused on the users needs
So does this means that if you have 100 keywords you need 100 ads? Not any more. Using keyword insertion you can place the keywords right there in the ad. If the keywords are too large to fit, you can specify a default to be placed in the ad instead.
If your default is ‘Mobile Phones’, just use this format {KeyWord:Mobile Phones}. If someone searches for ‘Motorola V8’ that is what they will see. If their phrase is too long (e.g. ‘I want a motorola V8 now now now!’) then they will get the default (Mobile Phones)
Check out the help file for this for more details. You would be surprised how few Google advertisers use this really valuable feature
Bob Browning's blog 
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