Usually, internet marketers use several versions of the same ad across the internet when they are trying to drive traffic to a website. The Ad Versions report will help you see which versions of your ad are bringing you the most traffic, so you can adjust other ads to work better for you. Or, maybe you'll decide to go with a completely different ad type.
Google will track the different ads and campaigns you set up by tagging each URL with a special code, so it can tell you where the traffic comes from. It may seem complicated but, Google has a tagging tool you can use to make the entire process less labor intensive and easier to understand.

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A screen shot of the tagging tool is to the right. All you have to do is enter the campaign source--where you are placing the ad--the campaign medium--paid per click, email, banner impressions, etc, and terms of the campaign (any paid keywords). Campaign Content is the place you put anything you want to use to identify and differentiate between your campaigns. Finally, name your campaign with something like a promotion, slogan, or product. Once you enter all this information, you'll be able to submit it and you'll be given a code to attach to the ads so Google Analytics can track them.