Investing for your business growth to reap more profit is a task in itself. But when it comes to budgeting, you need to be extra careful.
Are Google ads worth it? Decidedly, yes.
With all the benefits of Google Ads and the return of investment from it, we are sure you are looking at a much bigger and definitive question here – how much to spend on Google Adwords?
Now this article will take you exactly through the same, step by step, to reach a clear conclusion and leave you well aware of the technicalities behind Google adwords and gain clarity on how much to spend on Google Adwords.
Key Factors that Determine How Much to Spend on Google Adwords
The amount spent on Google Ad words depends on the type of industry you are in, customer decision making time and also the current scenario and trends in the global and local market.
Depending on which sector you are in and the competition in that field, the cost per click expense also increases. How much the clients are paying for your product through the CPC has a direct influence on this.
How long a customer takes to decide on purchasing your service also determines how much you have to expend on the ads.
The customer behaviours hugely are influenced by recent trends in the market. Prices are bound to go up or down depending on the favourability towards that particular service in the popular mind-set.
How much to spend on Google Adwords also depends on additional elements like relevance of the ad, ad format, experience of customers while visiting the landing page, etc.
Other aspects like scheduling of the ads during a particular time of the day, targeting the audience within a specific geographical region and targeting on multiple devices, also influence the ranking of your ad on Google, which ultimately determines how much to spend on Google Adwords. Also, read about tips on how to choose a ppc agency
Google Adwords Daily Budget Recommendation
Budget Daily = Budget Wisely!
While speculating on how much to spend on Google Adwords, you should start with a fundamental budget with an add on amount on the side, so that you can effectively spend it in case of tweaks and changes.
But once you have that basic or fundamental budgeting in place, you have to focus more specifically on daily budgets. This means you need to figure out how much to spend on Google Adwords monthly and then daily.
Now, the best approach to do this is to budget based on campaign.
Each campaign will cost differently, based on the output you desire out of it. Also if you are planning to do campaigns on different products at the same time, then figure out which product you are planning to push more, and spend more on it on the basis of customer buying tendencies and behaviours.
Once your monthly budget is set, break down how much to spend on Google Adwords on a daily basis. This can be calculated by multiplying your Cost per Click (CPC) with your expected daily ad clicks, which would give you the daily budget estimate.
What is the Average Cost for Google Adwords?
The one question that might be lingering on your mind while figuring out how much to spend on Google Adwords could be the average cost per click by industry standards. Find more: Paid media management service
Keyword Specific
Now this is not a one-answer question, as it depends on various factors. But the main component in deciding the cost per click (CPC) is keyword.
When it comes to digital marketing, it’s not exactly an entire page of advertising that you should focus on. Instead, while pondering on how much to spend on Google Adwords, you should shift your focus towards how much your niche specific keywords costs.
This depends on the competition between different brands or companies coming under the same keyword or simply put the competition within your market for the same keyword.
The average cost per click by industry standards in case of Google Adwords is within the range of $1 and $2 while considering the global market, but it could cost a lot less, when we localize the same. Certain keywords are much more expensive than others. For example, keywords like insurance, loans, mortgage, etc., related to the financial sector fall at the top, whereas industries like health with a keyword like treatment spend less for their keywords.
Longer Keywords Over Shorter Ones!
Although this is the case, most of the time keywords tend to be much longer than one word. The one word keywords tend to be a much smaller category when compared to long ones. This is because most of the time, your customers tend to search for DIY solutions to their problems and might prefer to chance upon a product suggestion among a lot of free solutions. And these long tailed keywords are much cheaper than the short ones.
Google Adwords Budget for Small Business
The next question troubling your mind about how much to spend on Google Adwords would be how much a typical business and particularly a small business would spend.
Recent research during COVID times has shown a significant increase in the Google Adwords spend in the industries like Online Education, Insurance, Marketing, etc. Whereas, there has been a huge decline in the spend in the travel and tourism industry, which was one sector that invested hugely before COVID times, which is completely self-explanatory.
According to our Google Adwords budget calculator report based on all our clients, we found that most of the small businesses spend on an average around $1000 monthly to keep their sales alive.
Now this amount may go up depending on the spending capacity of businesses. But depending on which sector and location you are, you could spend more or less.
You need to remember that the quality of your ads is an important factor to consider as it helps you in ranking better in search queries and results. Having a better ad placement is quite essential to getting noticed and being clicked on by the customers.
But ultimately, you also need to focus on the landing page as well, to have better results while spending on Google ads. Also, get ideas on landing page design tips
Have you decided on your monthly and daily ad spend? If yes, how have you proportioned the funds for each campaign?
If not, contact us, and we can help you get your ad spot on and running within a short time!
