What is Google Tag Manager and how does it work?

If you integrate external services into your web project, you normally have to juggle a large number of code snippets. In addition to requiring some programming know-how, this also demands a high level of oversight. To address this, Google released Google Tag Manager a few years ago, which significantly simplifies integrating different codes.

What is Google Tag Manager?

The Google Tag Manager (GTM) is a web-based tag management system from Google that lets you centrally manage tracking, marketing, and analytics tags without having to modify the source code directly every time you make a change. Instead of manually inserting individual snippets into your website or app, you control all tags through a single interface and publish versioned changes with just a few clicks. With these tags, you can analyse and evaluate user behaviour on your website to improve your UX. Originally, GTM was primarily intended for Google services like Google Analytics or Google Ads, but today it supports a wide range of third-party tags, including:

• Tracking, remarketing, affiliate, and conversion tags
• Integrations for consent management platforms (CMP)
• Testing tools or personalisation solutions
• Custom JavaScript tags

In today’s tracking landscape, Google Tag Manager plays a central role in:

• implementing Google Analytics 4 (GA4),
• integrating conversion tracking for Google Ads,
• setting up Consent Mode v2,
• enabling server-side tracking with server-side tagging,
• using a structured data layer to pass event and e-commerce data.

How does Google Tag Manager work exactly?

Google Tag Manager (GTM) acts as a central control unit for tracking and marketing tags. After you add a container snippet to your website’s source code once, this connects your site to the GTM platform. All additional tracking codes are no longer embedded directly in the HTML code, but are managed in the container via the tag manager’s web-based interface.

In Google Tag Manager, you create tags that send specific data to analytics or advertising platforms. Triggers define when these tags fire, such as when someone views a page, clicks a button, or submits a form. You can test changes first and then publish them as a new container version. This allows you to adjust tracking flexibly without editing the source code each time.

Sensible data processing using server-side tagging

In addition to the classic web container, Google Tag Manager also supports server-side tagging. This requires an additional container of the ‘Server’ type, which does not run in the browser but on a dedicated server or in a cloud environment.

Unlike traditional client-side tracking, events are not sent directly from the browser or web container to third-party services such as Google Analytics or Google Ads. Instead, the data is first sent to your own server endpoint. The server container processes this information and then forwards it to the relevant target platforms in a controlled way. This model offers several advantages:

✓ Greater data control: You decide which parameters are passed on to external services.

✓ More flexible data processing: Event data can be filtered, adjusted, or enriched on the server side.

✓ More robust data collection: Because fewer third-party scripts run directly in the browser, tracking can be less affected by ad blockers and browser restrictions.

✓ Better foundation for privacy and consent logic: Sensitive information can be anonymised or removed before it is forwarded.

However, server-side tagging does not automatically replace legal requirements such as consent prompts. Even in server-side setups, consent decisions must be taken into account and processed correctly. For smaller websites, a classic web container is usually sufficient. For larger, data-driven projects, especially in e-commerce or performance marketing, server-side tagging can be an important building block of a modern tracking architecture.

Tags, triggers, and variables in Google Tag Manager

For the container to correctly capture the desired events, interactions, and states and forward them to analytics, marketing, or third-party services, three core components work together in Google Tag Manager: tags, triggers, and variables. GTM provides numerous templates for all three elements. You can also use custom configurations or custom code. The following brief overviews explain exactly what roles tags, triggers, and variables play.

Tags

Tags are the central control units in Google Tag Manager. They define which information is sent to which services. Functionally, a tag corresponds to a tracking or marketing snippet, but instead of being embedded directly in the source code, it is managed centrally in the container. Typical tag types include:

• Google tags
• Google Ads conversion tags
• Remarketing tags
• Consent initialisation tags
• Custom HTML or JavaScript tags
• Server-side forwarding tags (for server containers)

Unlike older tracking architectures, modern GA4 setups with Google Tag Manager work entirely event-based. This means that instead of only measuring page views, you define individual events such as page_view, add_to_cart, or purchase, which are triggered via corresponding tags.

Triggers

Triggers determine when a tag is fired. In other words, triggers are specific events or user interactions with the web project that should cause code to execute. Typical triggers include:

• Page views
• Clicks on buttons or links
• Form submissions
• Scroll depth
• Custom events from the data layer
• Specific consent statuses

In addition, triggers can be combined with conditions, for example:

• Only on specific URLs,
• Only for specific element classes,
• Only when ad consent is active.

A trigger can be assigned to multiple tags, which makes it possible to efficiently map complex tracking logics.

Variables

Variables provide the dynamic values that tags and triggers need. They access information available when a page loads or when an event occurs. In practice, variables help refine trigger conditions. For example, a trigger can define that a tag should fire on a page view, while a variable can specify exactly which page or URL this should apply to.

In an e-commerce context, product IDs, basket values, or transaction IDs can be read via data layer variables and passed on to GA4 or other systems. Common types of variables include:

• built-in variables, such as URL, click ID, or referrer,
• data layer variables,
• custom JavaScript variables,
• consent status variables.

Data layer for structured data transfer in modern tracking

The data layer is a JavaScript data structure, usually an array, that acts as the central interface between your website and Google Tag Manager. It passes structured information to the container. Google Tag Manager continuously ‘listens’ for new entries in the data layer and responds with the corresponding triggers and tags. When specific actions occur on your website, such as a purchase, a click, or a form submission, you can ‘push’ the relevant information into the data layer.

In practice, this can look as follows. A person completes a purchase on your website. The website then writes structured data into the data layer:

dataLayer.push({
  event: "purchase",
  transaction_id: "T12345",
  value: 99.99,
  currency: "EUR"
});

Google Tag Manager detects the purchase event and then activates a defined trigger that fires a tag to track the user’s interaction. Typical use cases for the data layer include:

• E-commerce tracking (product data, basket values, transactions)
• Lead tracking (form submissions with contextual data)
• Consent status transfer
• Custom events
• Personalisation logic

How to manage consent correctly with Consent Mode

Since 2024, Consent Mode v2 has been required in the EU/EEA for companies that use Google Ads or Google Analytics 4 and want to run personalised Google ads. Consent decisions must be transmitted to Google correctly at a technical level. Google Consent Mode allows Google services to be used even before full user consent has been granted. In this case, only limited, non-personalised signals are processed. Full tracking may only be activated once the relevant consent has been given.

Consent Mode v2 therefore includes two additional consent signals that indicate whether personal advertising data may be processed and whether personalised ads may be served:

• ad_user_data
• ad_personalization

Google Tag Manager takes over the technical control in this context and ensures that tags are correctly fired or blocked depending on the respective consent status.

What are the advantages of Google Tag Manager?

Google Tag Manager is now much more than a convenient tool for managing tracking snippets. In modern tracking setups, it plays a central role in data control, privacy management, and performance optimisation. The most important advantages include:

How to use Google Tag Manager for your own web project

How do you implement Google Tag Manager? Google Tag Manager is free and web-based, so you do not need to install any software. The only requirement is a valid Google account. If you already use services such as Gmail or Google Drive, you already have one. Otherwise, you first need to create a Google account.

The following tutorial explains how to use Google Tag Manager for your own web project, create a web container, and integrate Google Analytics 4.

Step 1: Set up a Google Tag Manager account and create a container

1. Go to the official Google Tag Manager website.
2. Sign in with your Google account.
3. Click ‘Create Account’.
4. Enter an account name (e.g., company name) and the country.
5. Assign a container name (e.g., domain name) and select the target type. For traditional websites, choose ‘Web’.
6. Click ‘Create’ and accept the terms of service.

Google now creates the container. Typically, each website uses its own dedicated container.

Step 2: Add the Google Tag Manager container snippet

It may take a moment for Google Tag Manager to create the container. Once the process is complete, Google Tag Manager displays two GTM container code snippets. Add them as follows:

1. Copy and paste the first container code into the <head> section of your pages.
2. Copy and paste the second container code into the <body> section.

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Step 3: Create the Google tag

When configured accordingly, the Google tag can automatically track page views, scrolling, outbound link clicks, site search, video engagement, and file downloads. To set up the Google tag, have your GA4 Measurement ID ready. You can find it in your Google Analytics account in the format G-XXXXXXXXXX.

Here’s how to set up the Google tag:

1. In Google Tag Manager, go to ‘Overview’ and select the ‘Add a new tag’ option.

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2. In the Tag Configuration section, select the tag type ‘Google tag’ and enter your Measurement ID.
3. In the Trigger section, select ‘Initialization – All Pages’.
4. Name the newly created tag; in this example, we use ‘GA4 Configuration Tag’, and then save the tag.

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Step 4: GA4 event tags

In addition to the information that the Google tag measures for you (page views, scrolling, clicks on outbound links, site search, video engagement, and file downloads), you can also collect other data about user behaviour. For this purpose, Google provides so-called ‘recommended events’, which you must activate yourself but which already have a name and predefined variables. If you want to track a recommended event, you need to set up a corresponding GA4 event tag.

Recommended events include the GA4 event generate_lead, for example. This event records user behaviour using predefined parameters. Using generate_lead as an example, the following steps show how to activate GA4 event tags in Google Tag Manager.

To activate a GA4 event tag, you first need to identify the right trigger. GA4 specifies the recommended event name and the associated parameters, but not the trigger that starts the transmission of the event-specific data. For the generate_lead event, the key question is therefore what technical action creates a lead in your web project? The answer depends on the project. Google Tag Manager offers several suitable options.

In our example web project, a button click serves as the trigger for the generate_lead event. To set up the tag correctly, follow these steps:

1. In the side menu, open the ‘Triggers’ section and click ‘New’.
2. Select the trigger type ‘Click – All Elements’.
3. Give the trigger a name. In this example, we use ‘Button-Click-Trigger’.
4. Save the newly created trigger.

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5. In the Google Tag Manager side menu, open ‘Tags’ and click ‘New’ to create a new tag of the type ‘Google Analytics: GA4 Event’.
6. Enter your measurement ID. If you have not yet created a Google tag for this measurement ID container, as described in step 3, the system will detect this and display a note.
7. In the ‘Event Name’ field, enter the name of the recommended event. In this example, this is generate_lead.
8. Select the trigger you created earlier as the firing condition.
9. Give the new tag a name, such as ‘generate_lead tag’, and save it.

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Step 5: Take Consent Mode into account (relevant in the EU)

If you use Google Analytics 4 or Google Ads and rely on personalised advertising, conversion tracking, or remarketing, you must enable Google Consent Mode v2 in the EU to obtain active user consent for certain tracking and advertising measures. Google Consent Mode transmits consent information to Google services and runs tags depending on the consent status, either:

• in full,
• in a limited way,
• or blocks tags entirely.

To set up Consent Mode v2, proceed as follows:

1. Implementation of a CMP: First, you need a consent banner (cookie banner) that asks users for their approval. This is done via a Consent Management Platform (CMP). Your CMP must support Consent Mode v2 and have it enabled.
2. Prepare Google Tag Manager: In Google Tag Manager, go to ‘Admin’ and enable the ‘Consent Overview’ in the ‘Container Settings’. After that, you can manage consent settings for your tags.
3. Set default consent: Before users make a choice, a default value has to be set. In the EU/EEA, this is usually all consent types set to ‘denied’. To do this, you set up a Consent Initialisation tag (often via a CMP template) that fires with the ‘Consent Initialization – All Pages’ trigger. This ensures that no full tracking starts before consent is given.
4. Adjust tags: Review your existing tags (e.g., GA4 or Google Ads) in the ‘Consent Settings’ section for the required consents:

• GA4 tags require analytics_storage
• Google Ads tags require ad_storage
• Tags for personalised advertising additionally require ad_user_data and ad_personalization

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Step 6: Test the setup and Google tags (Tag Assistant)

Once you have fully set up your container, you should review your configurations before publishing:

1. In the Google Tag Manager workspace, click ‘Preview’ in the top right corner.
2. Enter your website URL.

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3. Tag Assistant opens. Check the following: Was the GA4 Configuration tag fired? Are events being sent correctly? Are consent rules being respected?

Step 7: Publish the container

If all tests are successful and you want to make your changes live, you can carry out the final step:

1. In the Google Tag Manager workspace, click ‘Submit’.
2. Select ‘Publish and Create Version’.
3. Assign a version name. If there are tags whose consent configurations have not yet been set, you will see a corresponding message at the bottom of the window.

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4. If no tags need to be revised, click ‘Publish’. Your changes are now live.