How Much Do Google Ads Cost?

So how much do Google ads cost? This a common question we get asked by people considering advertising on Google.

Unfortunately it is a tough question to answer. There are many different factors that will determine how much you end up spending on your Google ads campaigns. In this article we will be looking at the main factors that will determine how much Google ads might cost for your business.

How Much Do Google Ads Cost In Your Industry?

According to an article posted by Wordstream which you can see here. The average cost per click across all industries for Google search ads is roughly $2.69. For our readers in the UK this is approximately £2.11 at today’s exchange rate. However this is an average and the actual price can vary quite considerably.

The industry you are in is the first factor that will determine what you might pay for clicks on average.

Below are a few examples of extremely high cost industries for search ads on Google:

  • Personal injury
    how much do google ads cost personal injury
  • Casino
    how much do google ads cost casino
  • Insurance
    how much do google ads cost insurance

These are just a few examples and as you can see they can get quite expensive. Over £130 per click in the most extreme example. The high range of these estimates, are for extremely competitive bids, displaying ads in the top position for the given keyword.

As you will notice these are way above the average across all industries and they are extreme cases. Most industries will be nowhere near this expensive. In fact there will be many industries that are far below the total average.

Example of a client with low average CPC’s

Below is an example of a client account we are working with right now. This business has an average CPC that is far below the overall average. The data below is from the last 30 days.

how much do google ads cost low cpc

As you can see this is really low, this advertiser is paying just 12p per click on average. I can also confirm, that they have individual keywords in this account getting clicks for as low as 7p

If we compare this with the casino example above there really is no comparison. This particular campaign received nearly 7000 click for just under £800.

For the same budget someone bidding on live casino would have received between 6 and 9 clicks.

So when somebody asks “How much do Google ads cost?” this is the first thing we need to look at. What is the average CPC in their specific industry?

To determine the average cost in an industry, we will usually do our initial research in the Google keyword planner. Here you can find detailed information on keyword costs and traffic volume for keywords in your industry.

So why do prices vary so much by industry?

The reason industries vary some much in their average cost per click, is driven by the market place. Google ads is essentially an auction. Advertisers are ranked based on their quality score and their bid. If someone is appearing above you, there are really only two things you can do:

  1. Improve quality score
  2. Increase bids

So the marketplace (the advertisers) decide the bid. This would suggest that even when bids are extremely high, some advertisers are making it work. These companies would not be spending this much if they were not profitable.

Is Your Business Local, National, or International

The location and coverage of your business is another factor that will determine the price you pay.

This will have two main effects:

  1. If you are local you are restricted by how much traffic is available locally. If on the other hand your business is country wide or even worldwide. This will open you up to a much greater pool of available traffic.
  2. Certain areas are considerably more expensive than others below is an example for a plumber. One is in London and the other is in Leeds. As you will notice London is considerably more expensive than Leeds.

plumber london plumber leeds

The second point here can be particularly useful for national and international advertisers. As they are targeting over a much broader area.

By targeting the lower cost areas they can potentially lower their overall cost per conversion. Obviously this would have to make sense from a conversion standpoint. But it is a great way to lower average cost per click when it does make sense.

Unfortunately there will be less flexibility for smaller local advertisers as the local market and the advertisers in it, will determine the average bid.

With that said local terms will generally always be cheaper than broader, more generic terms.

How Quality Score Can Affect Your Google Ads Costs

Quality score is one of the main factors that make up ad rank. This is how Google determines where your ad will be shown.

There are 3 main factors that affect your quality score, these are:

  • Click through rate – This is the rate at which people click on your ad. If click through rate is higher this will give you a higher score. The best way to get a higher CTR is to write high quality ads that are relevant to the users search term and use a strong call to action.
  • Ad relevance – This ties in with the first point and means the ads in your account should be highly relevant to the users search queries.
  • Landing page experience – Your landing page is the final element of quality score and is based on the quality of the page. This is determined by things like page load speed, relevance and ease of navigation, as well as many other factors.

Scoring high on all three of these factors will increase your quality score. The result of higher quality score is a higher ad rank based on your bid.

Having a higher quality score means that your ad will appear in a better position and you will pay less per click.

How Much Do Google Ads Cost On Long Tail Keywords?

Long tail keywords make up a huge amount of searches on Google. According to Ahrefs, 92.42% of all queries on Google get 10 searches or less per month.

longtail curve

Keywords with over 1001 searches per month represent 60.67% of all available traffic in Google. However that means that anything 1000 or less still receives 39.33% of traffic.

So why is this important for advertisers? There are two main reasons:

  1. Lower volume terms tend to be more specific and this usually means they convert better. This is due to the fact that you can tailor your ads and landing pages more to the users query.
  2. Lower volume keywords tend to be cheaper due to lower competition. The majority of people will not put in the work needed to generate a large list of long tail keywords.

For advertisers willing to put in the work a long tail strategy can significantly lower your average cost per click. This can be particularly beneficial if you are in a highly competitive, expensive industry.

Below you can see an example of how the keyword “car insurance” compares with a longer tail term in the same industry. As you can see the long tail keywords bid estimates are considerably cheaper

Conclusion

Whenever someone asks us “How much do Google ads cost?” We will always tell them the same thing, there are a lot of factors to consider. It is certainly not a one size fits all answer.

To come to a reasonable estimate takes a good amount of research and planning. As well as knowing the budget that is available and the desired potential outcome. By combining these factors you can come up with a plan that will give a business the best possible ROI from their new Google ads campaign.

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