I pay only when an ad is clicked and I bid on search terms to trigger my ad, about $3.00 to $5.00 per click. I set a daily maximum to spend and pre-pay status will help me to monitor the cost.
The best thing is that a Google staff member built a half-dozen ads for me at no charge. He advised me on content for the landing page. We have had a few phone calls where my questions were answered. Now I have two campaigns and can easily create or revise ad groups in them.
Here's a picture of my keywords at the start. The quality score on the right reflects the web spiders' ability to find relevant content on the landing page. Note that the performance graph is a flat blue line as we start. It will be fun to see which of the ads Sam created rotate to the top.
My first Google search for web development found my ad in second place on the first page. Success!
Search for web design showed my ad above the fold on the first page as in the lower right here.
There is a lot more detail to discuss. For this post, I'll end with a big
Thank You to Sam Schulstad, Google AdWords Technician
MatalasCo -- Web development with a sharper idea for your online presence