This seems like a basic skill to cover in creating and maintaining an AdWords account, but not one that should be overlooked as unessential. Having good account structure has no direct benefit in ad ranking, bids or returns. The benefits are much more subtle and reveal themselves over time.
All accounts have campaigns, and all campaigns have ad groups. Campaigns define the majority of the targeting methods and how your ad will appear. Ad groups do not differ from each other significantly within a campaign except for their keyword content, ads being displayed and bid settings.
Because you set so much targeting settings on the campaign level it is recommended to split your advertising into different campaigns depending on your audience as well as your services and products. That is, if your different services target different audiences then the services should be separated on the campaign level. If you operate multiple store locations then each store should have an individual campaign to target audiences local to them.
It is recommended to separate different styles or themes of your products or services into ad groups. Although they cater to more or less the same audience you would want to use personalised ads for each in addition to other fine tuning of targeting options. For example even though both a day and night taxi service are virtually similar, you would want to display the night taxi service at a different time while highlighting the distinction in the services.
Another reason for separating your services or products by ad group is to be able to track the performance of each one without having to dissect through conflated data. It is possible that one general theme in your ads is facing competitive bids and other themes aren’t. In another case is could be that one theme in your services are generally not providing enough returns to justify running them.
By separating your service and product types you can easier identify trends and patterns in their performance. By understanding the market better, now even at a glance, it is easier and faster to make adjustments and observe the results thereof.
Beyond using account structure to better organise your products and services according to your market keeping to clear themes, titles and groupings helps collaborators. Businesses tend to grow and change and it may occur that other account managers may need to work on the same account. By keeping ideas and wording clear it should be possible for a new manager to immediately understand the purpose of each campaign and ad group without having to investigate each one’s keywords and minute settings.