{"id":16359,"date":"2022-02-24T20:54:04","date_gmt":"2022-02-24T20:54:04","guid":{"rendered":"https:\/\/mailinvest.blog\/index.php\/2022\/02\/24\/how-much-does-google-ads-cost-in-2022\/"},"modified":"2022-02-24T20:54:04","modified_gmt":"2022-02-24T20:54:04","slug":"how-much-does-google-ads-cost-in-2022","status":"publish","type":"post","link":"https:\/\/mailinvest.blog\/index.php\/2022\/02\/24\/how-much-does-google-ads-cost-in-2022\/","title":{"rendered":"How Much Does Google Ads Cost in 2022"},"content":{"rendered":"

<\/a>\n<\/p>\n

\n

How much does Google Ads cost? It\u2019s a reasonable question, and one we hear all the time, especially from newcomers to paid search. After all, you\u2019ll want to know whether you can afford it. The good news is, you can. The bad news is, there\u2019s no easy, one-size-fits-all answer. The clearest (and most infuriating) one we can provide is: it depends.<\/p>\n

\"how<\/p>\n

But don\u2019t worry. In this guide, we\u2019re going to cover all of the variables involved in Google Ads pricing so you can understand how much Google Ads will cost for your business and how to set a realistic budget.\u00a0<\/p>\n

Table of contents<\/h3>\n

Factors that impact Google Ads pricing<\/h2>\n

As mentioned above (and precisely why we\u2019ve written this guide), there is no simple or one-size-fits all answer to the question of how much Google Ads will cost your business. Google Ads pricing varies depending on your industry, customer lifecycle, current trends, and how well you manage your account.<\/p>\n

Industry<\/h3>\n

The biggest influence on Google Ads pricing is industry. For example, the business services vertical (legal, accounting, real estate, etc.) is one of the more competitive verticals in Google Ads, which generally translates to higher costs per click (CPC). This is due to the nature of the professional services industry: one new client could yield upwards of $1,000 \u2013 $10,000 depending on your business, so a CPC of $50 is a small price to pay for that client. \"google<\/p>\n

On the other hand, businesses in the arts and entertainment vertical have lower CPCs, but they need to reach a lot more customers to hit that $1,000 \u2013 $10,000 number.<\/p>\n

You can see our latest paid search advertising benchmarks for 20 different industries here.<\/a><\/em><\/p>\n

Customer lifecycle<\/h3>\n

You also have to take into account the lifecycle of your customer. For bigger ticket offerings, it takes longer for potential clients to move through the decision-making process, and your business needs to stay top-of-mind throughout that journey. This may involve multiple visits to your website, a content download or two, participation in a webinar, and more\u2014before taking that final step.<\/p>\n

Current trends<\/h3>\n

Neither consumer trends nor online advertising platforms are ever in a state of rest. It\u2019s important to keep up with what\u2019s going in your industry and within your niche\u2014sentimentally and empirically. Take COVID, for example. At the height of the pandemic, average cost per click for the apparel industry was about $1.40. It dropped down to $0.70 in April when average conversion rates went up, and then ended up at $0.89 in May.<\/p>\n

\"how<\/p>\n

How well you manage your account<\/h3>\n

A recent study by Google showed that the average ROI on Google Ads is 800%\u2014that is, $8 for every $1 spent. Of course, this all depends on how well you manage your account. You can\u2019t just activate your ads and kick back. If you want to keep your Google Ads costs low and your returns high, you need to:<\/p>\n

Are you making any costly mistakes in your Google Ads account? Use our Free Google Ads Performance Grader to find out.<\/em><\/strong><\/a>
<\/p>\n

How does Google Ads determine your cost per click?<\/h2>\n

The great part about Google Ads is that while it works as an auction, the winners aren\u2019t chosen based on bid alone, and you don\u2019t necessarily pay your maximum bid. How is this possible? Let\u2019s take a quick run-through on how Google Ads determines the winners and what they pay per click.<\/p>\n

Step #1: Quality Score<\/h3>\n

When someone searches on Google, Google looks to see if any advertisers are bidding on keywords relevant to that query. If yes, an auction is triggered and Google enters all relevant ads into the auction. Its first step in choosing a winner is to assign each ad a Quality Score<\/a>. This is a number from 1-10 determined by the ad and landing page\u2019s relevance to the keyword, expected click-through rate (which involves your historic performance), and landing page experience.<\/p>\n

\"how<\/p>\n

To learn more, head on over to this post: What is a Good Quality Score for Each Type of Keyword?<\/a><\/p>\n

Step #2: Ad Rank<\/h3>\n

Google will then calculate each contending ad\u2019s Ad Rank, which determines if and where your ad will be placed in the paid results section. Ad Rank is your Quality Score<\/a> multiplied by your maximum bid<\/a> (the most you\u2019re willing to pay per click on your ad).<\/p>\n

\n
\"how<\/article>\n<\/div>\n

The ads with the highest Ad Rank scores are the ones that get shown.<\/p>\n

\"how<\/p>\n

Step #3: Cost per click<\/h3>\n

If your ad gets shown, you only pay if someone clicks on it. But as mentioned above, you don\u2019t necessarily pay your maximum bid. The Google Ads cost per click formula is: the Ad Rank of the ad below yours divided by your Quality Score, plus one cent.<\/p>\n

\"how<\/p>\n

With this formula, an advertiser can pay less per click than another advertiser in the SERP and still be in the higher position due to a better Quality Score<\/a>. This is why advertisers with a small budget can compete with big spenders<\/a> on Google.<\/p>\n

\"how<\/p>\n

For a more in-depth explanation on the Google Ads auction, head to our post >> How Does Google Ads Work? The Complete, Visual Guide<\/a>.<\/p>\n

Additional variables in your Google Ads costs<\/h3>\n

There are several other variables that impact your Ad Rank\u2014and ultimately, your ad spend\u2014but maximum bid and Quality Score are the important ones to know. Here are some (but certainly not all) of the additional factors that influence your costs.<\/p>\n

For tips on how to keep your costs low, head to our post on 15 Ways to Lower Your Cost Per Click.<\/a><\/p>\n

How does budgeting work with Google Ads costs?<\/h2>\n

Let\u2019s move on to the next component of Google Ads cost: budgeting. All too often, advertisers see their Google Ads budget for the month get burned up<\/a> in a matter of days, leading them to believe Google Ads prohibitively expensive. This isn\u2019t necessarily the case; more often than not it\u2019s the result of a misunderstanding of how Google Ads budgeting works. So let\u2019s set the record straight. Here are the terms to know:<\/p>\n