Paid search can be a great way to boost your brand’s visibility and awareness – but do you know how much Google Ads cost and what you can expect to get for your money?
The Google Ads platform is one of the best tools available for quick lead generation. When used correctly, it can provide your website with highly targeted traffic to improve your chances of conversion. It’s a flexible, scalable platform that’s suitable for all firms, regardless of size or budget.
Google Ads actually covers a large variety of different ad types, from basic pay-per-click text ads that show up at the top of organic search results to display, video and retargeting ads. At a broad level, they can be broken down into nine key types, which are as follows:
One of the main reasons for turning to Google Ads is reach, as this gives you access to the largest audience on the planet. Worldwide, the platform accounts for around 84 per cent of searches – but in the UK, this increases to 93.6 per cent as of 2023.
What’s more, these users are well-accustomed to advertising. According to HubSpot, almost two-thirds of people (63 per cent) have clicked on a Google ad, while 68 per cent of marketers agree that paid advertising is either “very important” or “extremely important” to their overall marketing strategy.
In other words, your competitors will be using Google Ads, and your potential customers will be clicking on them. Therefore, if you don’t want to miss out, you need to be getting on board.
Google Ads can offer benefits to all businesses, as long as campaigns are planned and managed effectively. Among the key advantages are the following:
Another key benefit of using Google Ads as part of a campaign is its potential for a strong return on investment (ROI). According to Google’s own estimates, on average, for every dollar spent on the platform, marketers can see a return of $2.
This makes for a typical ROI of 200 per cent, which certainly compares favourably with other forms of paid marketing. However, the search engine itself goes further than this when the value of added clicks and visibility are taken into account. In fact, the company states:
“We conservatively estimate that for every $1 a business spends on Google Ads, they receive $8 in profit through Google Search and Ads.”
There’s no easy answer to the question of how much businesses can expect Google Ads to cost, as there are numerous factors that go into the calculations. Indeed, figures vary widely across industry, the size of the business and the type of campaign you’re running. However, having a broad understanding of what similar businesses and promotions are paying can give you a good starting point as to what you can expect.
There are a lot of factors that can affect cost-per-click (CPC) for Google search ads, so ‘how much will it cost?’ is not a straightforward question. In practice, it will depend on a wide range of scenarios and goals, which is why different sources often give different answers to this question.
However, to give an indication, figures from WordStream indicate that in 2023, the average overall CPC for Google Ads stood at $4.22.
Headline figures like this only tell half the story though. For instance, they don’t consider how likely each of those clicks is to lead to a conversion. If you’re in a niche industry or are targeting users with very specific queries, a higher cost-per-click may be more than offset by an improved conversion rate, whereas ads with a higher clickthrough rate may only lead to a few results if they are not targeted effectively.
While Google is the most popular platform for running PPC advertising, it’s not the only choice available. For instance, there are options with other search engines, such as Bing Ads that you may want to consider if Google Ads pricing seems too steep for your budget.
Indeed, some estimates suggest that Microsoft ads can be up to 70 per cent cheaper in terms of CPC than Google depending on the sector you’re in. Of course this reflects the lower traffic you’re likely to receive, but if you’re competing for highly popular terms, it may be an option worth considering.
You should also look into areas such as social advertising. Facebook ads, LinkedIn advertising and X/Twitter campaigns tend to be more expensive per click than Google search, but they have the advantage of often being more highly targeted, as social media sites can use the wealth of information they collect on their users to narrow down your desired audiences.
There are several factors that Google takes into account when calculating the price you’ll pay for your ad campaign. These include:
This can be quite a lot to think about, but once you get to grips with what each means in practice, you can start making changes to your ads and experimenting with techniques like A/B testing to find the combination that works for you.
The total cost of Google Ads can vary widely by industry. Indeed, this is one of the biggest determining factors that influences pricing, as this also has an effect on issues such as keywords and competition. Therefore, it’s important to understand what the typical expenses are for your own sector when determining whether or not your campaign will be cost effective.
WordStream’s figures show that in 2023, the average cost per click for search advertising across all industries was $4.22. However, it noted that actual costs can vary substantially depending on the sector in which you operate.
For instance it found that the three most expensive industries in terms of CPC are:
By contrast, the cheapest sectors in the study for ad cost were:
Once you understand what factors go into calculated Google Ad costs, you can set about crafting a campaign that’s optimised to provide the highest return on investment. While Google dashboards aim to make this as straightforward as possible, it still pays to have an expert pay per click partner on hand to manage your ad spend and offer expert advice on where best to focus your resources – as well as to help with the content creation for the ads themselves.
The first thing you need to do when creating a Google Ads campaign is to set a budget. This places an upper spending limit for each individual campaign – but you won’t necessarily spend all of this, depending on how you choose to manage bids. You can set a budget for a single campaign, or a shared budget – so for example, if you underspend on one campaign, the remaining budget can be automatically sent to another.
You should set your budget based on the average amount you’re willing to spend per day. If you prefer to think in monthly terms, you can calculate this by multiplying your average daily budget by 30.4. You can also set a maximum cost per click for bids, which places a cap on how much you’ll pay for each ad click. The higher you set this, the more bids you’re likely to win and the more traffic you can expect – though naturally, it will mean spending more.
How much you’re willing to pay for an ad is only half of how Google determines where your ad is seen. The other half relates to quality. This means you can still appear above your competition even if they pay more than you, providing your ad has a strong quality score and highly relevant keywords.
The best way to assess your ads is by using Google’s Quality Score, which is a tool to see how your ads perform compared to competitors. This isn’t a direct factor in a Google Ads auction, but can be used to improve your ads, landing pages or keyword selection in order to reduce your CPC.
Quality Score is calculated based on three key elements. These are:
Ads that are rated as above average in all three categories are more likely to be rewarded with higher placements and, in turn, lower costs. According to Wordstream, an ad with a top Quality Score can enjoy a 50 per cent lower CPC than an average ad, while one that scores poorly (one out of ten) can cost 400 per cent more than average
Google provides a range of tools for monitoring the performance of your ads. In addition to the Quality Score that can tell you how you measure up to the competition, you can find a variety of information in your Google Ads account.
For example, under the Ads page, you’ll be able to view the following key details about your campaigns:
As well as ads, you can also view the performance of each of your keywords and your wider campaign goals. Google offers tools for key performance indicators such as impressions, traffic, conversions and sales in order to give you a clearer idea of your overall return on investment.
It also pays to team up with a full service agency. A good partner will not only be able to provide full analytics insight into your campaigns, but offer clear advice for how to improve in the future. This may include keyword research to uncover any new opportunities, content creation for search and display ads, and website audits to make sure your landing pages are up to scratch.
Get in touch with Axonn today to find out how we can help you make the most of your Google Ads account.
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