So, you’ve identified the Google search network as a big opportunity for your organisation…But how much does it cost to run ads?
It’s something we get asked A LOT as an ad agency, but it’s not always a straight forwards answer (sorry!).
In this article, I’m going to try to help you understand the typical costs of running Google ads, the different factors that can affect your Google ads cost, and what your minimum ad spend should be.
If you’d rather just have a chat with us and get an expert opinion on estimated costs to get a strong return for your business ads, then shoot me an email and we can set up a time to chat: firstname.lastname@example.org
How Do I Pay Google?
First of all, let’s start with how paying to advertise on Google actually works.
Google is the biggest search network ad platform in the world, and you pay per click.
You only pay Google when someone clicks on your ad, if they see it and don’t click on it, you don’t pay. This is why it’s important to optimise your ads and make sure you’re trying to rank for the right, relevant keywords, otherwise you’re wasting clicks (money) on low-quality traffic.
Google works on a bidding system, where you bid for your advert to show up for your chosen keywords. The aim is to get in front of people with the right search and buying intent at that very moment. Then your ad and landing page does the rest of the work in converting them.
Why Are Google Ads Expensive?
When you run Google ads, you’re basically bidding against other advertisers to rank at the top of the page for that specific search. Google, by nature, is much higher quality traffic that is much further down the sales funnel because they are already searching for what you offer.
For this reason, Google is naturally more expensive (generally speaking) than most other ad platforms. But it’s for this same reason that it also typically gives the best returns for advertisers!
For a search or keyword with higher demand, showing up at the top of the page is likely going to be expensive. This is why people often use the keyword planner tool to find a keyword that has sufficient search volume (demand) but is less widely used and competitive.
If your business is a niche one, for example, you sell recycled clothing for dogs, then it’s likely you’ll have low competition, and so your average CPC might only be a few pence.
How To Reduce The Cost Of Google Ads For Your Business
Improve Your Website!
Sending people to a high-quality, professional, and relevant landing page/website is a HUGELY important part of your Google ads mix.
Firstly, if your website content (copy) isn’t relevant to your ad copy or the search term you’re bidding for, then Google will value your advert less than advertisers with more fitting websites. You can read more about their rating system for ads below.
Secondly, if a customer clicks on an advert expecting one thing, and get’s to your website to find something totally different. It’s not rocket science to work out you’re going to have a low conversion rate.
If you search for a Facebook Ads agency, click on an ad advert that says “we help you with Facebook ads”, then the website is for a Google Ads service, you won’t get many sales.
Raise Your Quality Score
Google has its own internal rating system for advertisers, that determines the quality of your ads based on a number of different factors.
Google itself says “Quality Score is a diagnostic tool meant to give you a sense of how well your ad quality compares to other advertisers.”
The quality score is measured on a scale of 1 to 10 and is used at the keyword level in your campaigns.
Your quality score can seriously affect your performance and the position of your ads on Google.
The higher your quality score, the better your ads will rank and the more relevant clicks you will get, and the more value you will get for your money.
In short, to improve your quality score, you want to make your ads highly targeted and relevant to the search quey in question.
Google works out your score on the expected click-through rate, ad relevance, and landing page experiences.
Use Negative Keywords
A negative keyword means you’re telling Google to NOT show your ad for a specific keyword/phrase.
This is a really effective strategy for eliminating wasted, irrelevant clicks from low-quality traffic, and it’s a technique we use with every ad account we manage!
Here’s an example for you:
A business is selling craft courses teaching people during an in-person workshop how to make gift cards. They might run ads for the keyword “gift card crafting”.
But, depending on the keyword type they selected, their ad could show up for someone searching “gift card crafting kit”. This is relevant because this customer is looking to buy a kit to make cards at home. They’re not looking to attend a course.
So in this case they might set “crafting kit” and/or “gift card kit” as negative keywords. This way Google knows not to spend their ad budget on those searches.
It’s All About Timing!
Our job when running ads for clients is to build out a huge A/B testing machine that is constantly optimising and scaling your revenue.
One of the many optimisations we can make for a campaign is looking at the data for traffic and conversion based on days of the week and times of the day.
For example, lots of our B2B clients have low search volumes and low conversions at the weekends. So we might turn their ads off on Saturdays and Sundays to make sure we’re spending their budget more efficiently.
Use The Right Keyword Match Types
There are 3 main keywords to select from, and they can significantly improve or worsen your cost per click.
We’ve actually written an entire Keyword Match Type Guide for you where you can understand the options in more detail here.
- Broad MatchWe rarely recommend broad keywords as, although they help you reach the widest audience, they VERY often bring irrelevant clicks from searches that don’t relate to your service or product.
- Phrase MatchPhrase match provides some of the wide reach and versatility of broad match keywords but gives you much more control over who sees your ads.
- Exact MatchThis is the most restrictive keyword type and delivers puts your ads in front of a much more specific audience. You might reach fewer people, put in our experience this or Phrase match will get you much better value for your ad spend and will lead to less wasted budget.
Average Cost Per Click (CPC) On Google
Overall, the data shows that the average cost per click across all business types and keywords in the US is between $1-$2.
Ultimately, working out how much search ads cost for your business specifically is always going to be difficult as it depends on all the factors I’ve detailed so far. But there is some data out there based on your industry and location.
On average the industries with the highest cost per click are:
- Legal/Insurance – $6.75
- Consumer Services – $6.40
- Technology – $3.80
On average the industries with the lowest cost per click are:
- eCommerce – $1.16
- Advocacy – $1.43
- Travel + Hospitality – $1.53
What Is The Minimum Ad Spend Needed For Google Ads?
We actually wrote an entire blog post all about the minimum you need to spend monthly across the main ad platforms, in order to help you set a budget for your PPC ads. You can read that here.
For the brands we work with, we recommend a minimum spending a minimum of £1000 per month on their PPC ads.
Of course, you can start online advertising, and make a return from ads with much less. But there’s no escaping the fact that PPC ads are a money game.
The way I like to describe it is the more you can spend, the more ‘votes’ you’ll be receiving for a particular ad image/video or the more ‘votes’ you’ll be getting towards a certain keyword. As mentioned earlier, running paid ads is all about A/B testing.
The less you invest, the fewer pieces of data (votes) will be flowing through your ads, and the longer it will take for you to learn what does and doesn’t work for your brand.
Is Google The Right Platform For You?
So, now you have a better answer to the question of how much does Google ads cost for your business.
But, the even bigger high-level question you should be thinking about, especially if you’re starting on a limited monthly budget, is which ad network you should focus your time and money on to start with!
Maybe your product or service isn’t actually one your target customer will already be searching for. It might be an innovative new solution that they need to be educated and sold on. Or maybe you are in a very high competition sector and you think Google Ads are going to be a much harder thing to make returns from initially.
We’ve created a quick 6 question quiz specifically to help you find out the best ad platform for your kind of business: