What the customer typed, and what you paid for it
The search term report says which search your ad showed on, what that search cost and what it returned. Negative keywords and new targets both come from here: terms that do not sell get closed, terms that do sell get their own target.
Two different questions, two different sources
A keyword is what you bid on; a search term is what the customer actually typed. They are often not the same, and the gap between them is where broad match spends money.
The matched target sits next to the term, so you can see which bid let that search through before deciding what to do about it.
From a term to an action
A term that sells steadily deserves its own exact target, with its own bid. A term that takes clicks and never converts belongs in a negative list.
Both are one step from this screen, and both go through the same approval as any other change.
Frequently asked questions
What is the difference between a keyword and a search term?
A keyword is the target you bid on. A search term is the query the customer typed that your ad matched. Broad and phrase match let many terms through one keyword.
Can I turn a search term into a target?
Yes. A converting term can be opened as its own exact target, and a wasteful one added to a negative list, from the same screen.