How Much Does a Google AdWords Ad Cost?
It’s a question and one we hear all time, especially from beginners to AdWords ad paid search. After all, young people in PPC are probably more interested in how much they will be expected to pay to advertise on Google, and if they can still afford it!
Unfortunately, there is no easy answer. The most common answer is, “It depends.”
The cost of AdWords depends on many variables. In this article, I will explain how these variables will affect the cost of your ad and understand the concepts you need to understand to set a budget for your campaigns (and decide if you should use AdWords).
Here is a high-level preview of what you will learn in more detail in this guide:
1.Google AdWords is based on an auction system that rewards businesses with high quality, low cost, and better ad placement campaigns.
2. You can exercise strict control over how your AdWords budget is spent using tactics such as ad scheduling, geo, and targeting. The average CPC on Google AdWords is between $ 1 and $ 2 on the search network. The average CPC on the Display Network is less than $ 1.
4. The most expensive keywords in AdWords and Bing ads cost $ 50 or more per click. These are generally highly competitive keywords in industries that have high customer value, such as law and security.
5. Big retailers can spend up to $ 50 million a year on paid search in AdWords.
6. The average small business that uses AdWords spends between $ 9,000 and $ 10,000 a month on Google paid search campaigns. That is $ 100,000 to $ 120,000 per year.
Now, let’s take a closer look at these AdWords cost points.
How does AdWords work?
Before we get into the details and start talking about cost, it is important to know how the AdWords platform really works.
One of the biggest misconceptions about AdWords is that whoever spends the most money has the most influence. While a larger advertising budget does not spoil us, AdWords is actually a more level playing field than many new advertisers realize.
Google AdWords works in much the same way as an auction. Let’s see how this process works.
The ad auction
The ad auction starts when a user enters a search query, from which Google determines if the query contains keywords that advertisers are currently bidding on. If advertisers bid on some of the keywords in the user search query, the ad auction begins.
The purpose of the auction is to determine the Ad Rank or where each ad will be placed.
The auction determines the inclusion and placement of ads according to the type of ad ranking based on two main factors – the maximum bid and the Quality Score.
How does my Google AdWords budget run out?
A common scenario in which many newcomers to paid search find themselves is when their advertising budget is spent much faster than expected.
Understandably, this can be a shock. Advertisers may be estimating their ad budget for a month until they find that the money flies in a matter of days.
This can lead to even more misunderstandings about paid search, that is, that it is prohibitively expensive.
However, this is not necessarily the case, and it is more often than not a misunderstanding of how the budget works.
PPC Ad budget basics
You can think of advertising budgets in the same way you would for any other budget. You start with a key element that will make up the bulk of your ad budget and allow a margin for change if something goes wrong. One way to start budgeting a PCC account is on a campaign basis.
Each campaign has its own unique AdWords settings tab. This allows you to control some specific parameters of your campaigns independently of other campaigns in your account. Each campaign should have its own daily budget. If you are running multiple campaigns at the same time, you need to think about which campaigns have priority.
For example, an advertising campaign that promotes the best-selling product may be more relevant to your business than another campaign that promotes content to potential customers at the top of the pyramid. In situations like this, you may want to spend a larger daily budget on your product campaign.
If you are planning a monthly PCC budget, all you need to do is calculate the daily budget allocations for each campaign and allocate your money according to the priority of each campaign.
How the daily budget is spent
Suppose you have an ad with a CPC of € 0.25 and you would like to receive 300 ad clicks per day. Using these data, you can calculate an estimated daily budget:
.25 x 300 = $ 75
In this example, 25 cents is the highest you would charge if 25 cents is your maximum CPC. However, the actual amount you can be charged per click may change, depending on the variables of each ad auction.
Just keep in mind that if you set your max CPC at 25 cents, you will never pay more than one click – but you may end up paying less. Sounds simple enough, right? Well, there are several factors to consider that can affect your PPC budget, the first of which is the day-to-day.
Time Ad scheduling
Also known as ad scheduling, it is the practice to determine when you want your ads to appear to potential customers. Although your ads will need to continue the ad auction process, you can notify Google when you want your ads to appear.
This is useful for local businesses that want to drive clients to a physical location through their ads. If you have a store that closes at 7pm, you may not want your ads to appear outside of your business hours.
Alternatively, you can specify that your ads run continuously throughout the day, but allocate most of your daily budget for hours during which you want more traffic.
Just as you can spend more than your budget at certain times of the day, you can also spend more than your budget in certain geographical areas. This technique is known as geographical targeting.
Geolocation allows you to prioritize your ads over searches coming from specific areas. These areas can be as large as a state or province, or as small as a three-square-foot radius of your store.
Geo-targeting is a great way to take advantage of the growing mobile traffic trends and shopping habits of today’s consumers and can affect the way you spend your daily advertising budget.
For example, you may want your ads to appear next to related searches in a particular situation, but you can also budget more for searches in a specific city or even neighborhood.
Gone are the days when prospects were sought exclusively by desktop browsers. Today, consumers search the Web on multiple devices (often at the same time), which means you have to pay attention to where the most valuable products come from. This is where device targeting comes into play.
Suppose you want to appear in search results on Desktop and Mobile computers, but mobile traffic is more valuable to you. You could specify that a portion of your budget be spent on desktops, but most will go to mobile devices. You may want to spend more money on traffic coming from certain types of mobile devices, depending on what you are advertising or your ad copy.
Defining a daily budget and understanding how it will be spent is one of the most important aspects of your PPC budget, but it is worth knowing how advanced targeting options can affect your advertising spending.
Google AdWords Pricing: How Much Does a Standard AdWords Click Cost?
Once you know about what PPC is, and how paid search works, it makes sense that your next question might be, “How much does a standard click cost?” This is not easy to answer.
You can think of PPC advertising roughly according to traditional ads, one would expect to spend more on a glossy full-page ad in a national cover than on an ad in a local newspaper.
In Digital Marketing, the distinction is not in the form of advertising, but the marketing intent and competition for the keywords you offer. Some keywords are more expensive than others, depending on how competitive the market is, and it is very important to understand, before launching an Adwords campaign.
People sometimes want to highlight the big, keywords. The reality, however, is that these keyword categories are only a small fraction of the total search volume.
What if someone searched for the question, “How do I get the ants out of my kitchen?” They can see for tips on how to get rid of ants in their bathroom, but they could also be open to seeing an advertisement for a company (and if you have ever tried to keep ants out of a kitchen, this one the scenario suddenly becomes much more reasonable).
This is the kind of opportunity that keyword targeting offers to advertisers. In addition to accomplishing the vast majority of searches, Long-tail keywords are also often significantly cheaper than the shortest questions that cost a fortune and can have as much – if not more – commercial intent.
How Much Money Does a Standard Business Make on Google Adwords PPC?
Usually, when someone asks about the average cost per click of a PPC ad, their next question will be how much money “typical” businesses spend on PPC, in the context of the highest cost of internet marketing.
Unfortunately, this is another difficult question without an easy answer. However, this does not mean that I can not tell you a little more about how much a “typical” business spends on paid searches. First, we need to look at the overall cost data from the industry.
If you look at the above CPC tools, you will see that the most competitive terms are in the insurance, financial services, and legal industries.
How Much Does a Small Business Cost in AdWords?
With that in mind, I asked Erin Sagin, one of WordStream’s Customer Success Managers, to calculate how much the average WordStream customer distributes to PPC per month.
Some companies spend around € 1,000 a month (and I say “only” purely for the purposes of the framework, it is still a lot of money for many small businesses), while others spend over € 30,000 a month, such as PPC management agencies.
The term part ranges from 1,000 to 9,000 euros from small to small and medium enterprises. Overall, the average CPC of keywords across all industries typically ranges between $ 1-2 – significantly lower than the AdWords and Bing averages listed above.
What other costs are involved in PPC?
The advertising budget will always be the biggest and most direct cost associated with PPC campaigns.
There are other potential costs that you may need to consider, depending on your business, marketing goals, and personal situation.
Some small businesses choose to have an organization to handle PPC work for them. This approach offers some benefits, such as minimal investment of time and effort to actually manage your PPC account. Organizations can also have years of experience in managing PPC accounts, making them reliable partners who can offer expert advice and guidance.
However, these services are not cheap. Even a small advertising business will get a percentage of your advertising costs, regardless of the return on investment (ROI). Some organizations can guarantee a minimum ROI, while others will not. Service cuts are usually around 10%, although this varies from office to office.
Obviously, it is in the best interest of the organization to deliver results, but even if your ads do not result in conversions, you will have to pay the advertising company
How to choose the right person, business for Adwords
AdWords is a great advertising platform. It offers advertisers a high degree of control over the expensive variables in their accounts and can be extremely powerful in the right hands. The biggest complaint we hear from our customers is that, because of its power, AdWords can be intimidating – especially to young advertisers.
This is why many businesses tend to change companies and people who have taken on Adwords campaigns.
Some business owners choose to manage their PPC accounts on their own, and I understand that. Times are tough and every euro counts.
However, if you do not have time or are not sure what to do (or both), investing in someone who knows the platform is a great way to save time, reduce costly mistakes, and get your business up and running.
There are many factors that can have a significant impact on the cost of running a PPC campaign, but remember: Almost any type of business can make AdWords work for them!
Read more- What is Google AdWords and how is work?
Share experiences, reflections with us to discuss them.