How Much Does Google AdWords Cost?

September 30, 2021

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It’s a question that seems to be on every small business’ owner mind – how much will a campaign with Google AdWords cost you? More than that, when you crunch the numbers and analyze the results of your PPC campaign, will your efforts be profitable?

The answer to this question is not as easy as we’d like. Here’s the thing: the profitability of your pay per click campaign depends on a variety of factors. Your daily budget and your average cost per click will vary greatly based on your industry, your audience, and the popularity of your products or services. Therefore, if you want to know how much money you should put aside, you’ll need to plan everything carefully.

In this article, we’re going to explore the costs of AdWords and tell you what you need to do if you want to dominate the search network.

Google AdWords 101

Before asking about costs and how to prepare your budget, you need to understand first how AdWords works.

In a way, Google AdWords is one big auction. A user enters a search query, and Google determines if that query has any specific keywords that advertisers are bidding on. If that’s the case, then Google will calculate your Quality Score and Ad Rank and determine how much you have to pay when people click on your ad.

The question you may be asking yourself now is if you can gain any control over how your AdWords determines the value of your average CPC.

Let’s find out!

Your Google AdWords Budget

Let’s make one thing clear from the start: you are the one deciding how much you should spend to have your ads shown on the display network. That’s why it would be better to start with a daily budget and set a maximum daily limit that you can then change whenever you like.

Keep in mind that keywords are the main element that will drive your AdWords budget. Some keywords are more popular than others, so if your budget is relatively low compared to the cost of keywords, your ads won’t appear every time someone searches for them. The more advertisers bid on the same keywords, the more ads will compete for the same ad space. Use Google Keyword Planner to determine the search volume of your target keywords and look for long tail ones that are less popular but could help boost your ad rank.

The next step you will need to take is determining how much you’re willing to pay for a click. Try to estimate how likely it will be for someone that clicks on an ad and lands on your landing page to convert into a customer. Use Google Analytics to check your conversion rate and figure out what you need to do to increase it.

Google also offers several other tools that can help you study your data and determine the course of action that could help you improve your results. With this information at hand, you can choose the right keywords and use your budget to its maximum potential.

How Do You Audit Your Google AdWords Budget?

Imagine that you’ve exceeded your budget and you don’t want to invest any more money into an AdWords campaign. Before you give up on your pay per click efforts, you should analyze your efforts and determine what went wrong and what you can improve.

That’s where an AdWords audit can come in handy.

An audit can help you find any possible gaps or money you’ve wasted that you could have used differently. There are several ways to perform an audit of your budget.

  • Measure and Adjust Labor Costs – Time is money, so every extra hour and minute you’re spending on other advertising campaigns could represent a lot more than you think. Take your hourly rate and multiply it by the hours you spend on a certain task. That will give you the cost of labour for that specific task and help you get an accurate idea of how much you’re spending and how much you can save if you start cutting back on a few hours every month. Then, you can use those extra hours and money and invest them in Google AdWords.
  • Trade Platforms Check out which of the platforms you are currently using are draining too much of your time and budget without delivering any significant results. The goal is to figure out what you can remove and save for your PPC campaign. Analyze your conversion data and calculate your costs by comparing generated revenue to closed leads. That way, you’ll be able to estimate how much revenue is a platform generating and if that platform is worth keeping.
  • Look at Your Tools Last, but not least, you can take a look at the tools you’re using and the costs allocated to them. As a marketer, you probably use a diverse set of tools for keyword research, monitoring, ad scheduling, and more. But all of these tools cost money, so take a good look at what you’re currently using and how vital they are. Try to eliminate those you think are not so essential and that don’t necessarily bring you any benefits.

Investing in Google AdWords can have a big impact on your business. But before you jump headfirst, you should know what you’re getting into. Marketing services can get pretty pricey, pretty fast, so knowing how Google Advertising works and what to expect from it can help you keep your budget under control.

Billy P.

About The Author

William Polson founded Australian Internet Advertising in 2013 and has over 12 years of experience immersed in Digital Marketing.

With an in-depth level of digital marketing knowledge, William has been sort after by and worked for, many large national brands including Subaru, Blooms The Chemist, and Nova 96.9.

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