How much does Google Ads cost per month?

Date Posted: September 15, 2023

Understanding the costs involved in digital advertising can be a tricky task, especially if you’re trying to pin down specifics. Among the numerous platforms available, Google Ads often emerges as a top choice for businesses looking to reach their target audience effectively. This is where the insight from marketing consulting can be invaluable, offering tailored strategies to navigate the platform’s cost structure.  However, a question that commonly arises and needs clear answers is: What’s the actual monthly cost of running a campaign on Google Ads? This is a critical consideration for any business, whether a start-up or a well-established enterprise, because budgeting properly can be the difference between a successful campaign and an ineffective one.

Factors Influencing the Cost

Several factors impact the overall cost of a Google Ads campaign. Here are the main contributors:

• Industry: The field you’re operating in plays a significant role in the costs you’ll encounter. Various industries face differing levels of competition, directly impacting the cost per click (CPC). For example, some industries are highly competitive, making the cost per click significantly higher compared to others.
• Keywords: The competitiveness of the keywords you select is a major factor. Keywords that are highly sought after naturally cost more per click. Therefore, picking the right set of keywords can either ramp up or bring down your costs.
• Location: Where you aim to display your ads also has a bearing on cost. Depending on your target location, you may find that costs fluctuate. Some areas might be more expensive to target due to higher competition or demand, while others could be less so.
• Quality Score: This is a metric that Google uses to measure the relevance and quality of your ads. A higher Quality Score is advantageous because Google offers lower costs for ads that are well-crafted and more pertinent to the user’s query. Improving your Quality Score is a strategic way to make your budget go further.
• Ad Extensions: While adding ad extensions, such as additional links or contact details, can enhance the visibility of your ads, they can also increase the cost. It’s crucial to weigh the benefits against the added expenditure to make an informed decision.

Understanding these variables gives you a clearer picture of how your monthly costs are calculated, and more importantly, how they can be optimised for better results.

Average Cost Per Click

The average cost per click (CPC) is one of the most critical figures to keep an eye on. CPCs can vary dramatically depending on the industry and the competitiveness of keywords. Generally, you can expect the following:

• Low-competition industries: $1 to $2 per click
• Medium-competition industries: $2 to $5 per click
• High-competition industries: $5 to $10 or more per click

Budgeting Strategies

So, how much should you allocate to Google Ads each month? It really depends on your objectives and the scale of your campaign. Here are some budgeting tips:

• Start Small: If you’re new to Google Ads, consider starting with a modest budget and scale up as you gain experience.
• Review & Adjust: Continuously monitor your campaigns. If a particular ad is performing well, consider reallocating more funds towards it.
• Seasonal Budgeting: Some businesses experience seasonal trends. For such cases, a flexible budget strategy can be beneficial.

Estimating Monthly Costs: Doing the Math

Now that you’re aware of the factors influencing costs, you can make an educated guess about monthly expenses. Here’s a simple formula:

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Say you’re in a medium-competition industry with an average CPC of $3. If you aim to get 100 clicks a day, your daily cost would be $300. Multiply this by 30 days, and your estimated monthly cost is $9,000.

Minimising Costs Without Compromising Quality

Keeping costs in check while maximising the effectiveness of your campaigns is key. Here are ways to do that:

• Optimise Ad Copy: Writing better, more relevant ad text can have a direct impact on your Quality Score—a metric that Google uses to evaluate the relevance and quality of your ads. A higher Quality Score can result in a lower cost per click (CPC), making your campaign more budget-friendly.
• Long-Tail Keywords: Opting for long-tail keywords is another effective tactic. These keywords are more specific and, as a result, less competitive. They usually cost less per click and attract users who are more likely to convert, enhancing the effectiveness of your campaign without straining your budget.
• Scheduled Ads: Timing can also be a significant factor in controlling your costs. Running ads at specific times of the day or week when competition is lower can help you make the most of your budget. Scheduling your ads avoids those peak times when competition drives up costs, thereby improving the overall efficiency of your spending.
• Employ Dynamic Keyword Insertion: This feature allows your ad to automatically update itself to include one of your target keywords that matches a user’s search query. It can make your ad more relevant and potentially improve your Quality Score, further reducing your CPC.
• Regular Monitoring and Adjustment: Keep an eye on your campaign performance and don’t hesitate to make adjustments as needed. If one ad or keyword is outperforming others, consider reallocating more budget towards it. Likewise, pause or adjust campaigns that are not delivering the desired results to ensure optimal use of your budget.

Summary

The cost of running a campaign on this platform is far from a set figure. It’s influenced by a multitude of factors ranging from the industry you’re in to the keywords you select. Although the platform is designed to be flexible, accommodating various budget sizes and business needs, getting to grips with the subtle intricacies can make a meaningful difference. By taking a calculated approach towards key elements like CPC, your budgeting strategies, and the quality of your ads, you’re well-positioned to maximise the effectiveness of every dollar spent.

Learn more about how a marketing agency can help you run and set-up your Google Ads here.