Adwords: What does it Cost to Advertise on the Google Search Network?

average-conversion-rates-google-adwords-funnel

Costs per click on Google Adwords. **Please note this chart is an average across all industries…

As a new or existing PPC advertiser, you might like to know what is good click-through-rate or a good cost per click, for your industry as well as wanting to know how much it will cost per month to advertise on Google.

Google does not disclose these numbers – perhaps because the numbers change dramatically depending of the QS (quality score) of the landing page and campaign and different industries, but here is a report from WordStream for Q3 2012 that gives some ‘average’ numbers:

Average cost per click:

Google Search (Adwords)  :  $0.53

Google Display Network (banner ads through Adwords):  $0.35

Average click through rate:

Google Search (Adwords)  :  3.47%

Google Display Network (banner ads through Adwords):  0.18%

So, if a dentist/doctor wants to spend $500 per month in Google Adwords management, he/she could expect to receive 943 visitors to his/hers web site from Google Adwords Search, if we use the math from the above report.  —  This works out to be about 27k ad impressions, which about $18 CPM.

Not all of these visitors will turn into customers, but perhaps 5% of these people will buy something from the dentist/doctor – according to the numbers from the above report.

The Google Adwords network is an auction bidding system and it is not at all the same as buying banner ads through a media channel, for example at $10 per thousands views (CPM) from MSN or Yahoo.

The cost for advertising through the Google Adwords network is really unknown until the landing page and website has been designed for high quality score and the proper ad campaign has been designed.  It depends on the quality of the Adwords campaign, and this is where it is important to do things right when setting up the Adwords campaign and designing the landing page.

My own Adwords results:

Looking at my own Adwords account, I can see than my average CPM (cost per thousand views) for the month of April 2013 varies between $0.53 to $13.08, with an average of $1.70 CPM.

Please note that this is an impressive and low figure, as I have several campaigns with high quality traffic at only 1 or 2 cents per click in Google Adwords!  I realize his is almost unheard of, as the average cost per click Adwords advertisers is a high $0.53 per click according to the above report.

However, I have the advantage of having done Adwords managment for almost 10 years, and my own PPC results shows there is high payoff for people that know their skills with Google Adwords.  It is still quite possible to buy inexpensive traffic from Google – if you know how to do it right.  (smile)  In other words, you can do better than the average results in this report from WordStream.  The cost for Adwords advertising also depends on what industry you you in.

So, what should your overall budget be for your PPC campaign?

According to Optimum7, that depends on the size of your business.

A small business should spend a minimum of $1,000 a month to have an effective PPC campaign. Ecommerce sites and medium sized businesses should be spending around $8,000 a month to ensure their PPC campaign is a success. Large and very competitive businesses, like a company that sells office furniture or electronics, should spend a minimum of $20,000 to $50,000 a month on their PPC campaign to make sure they stand above the rivals in such a highly competitive market.

However, the good thing about paid search advertising (PPC) is that conversions and efficiency can easily be tested and optimized with automatic computer tracking scripts.  This way money is not wasted, and new customers can be found that produces revenue greater than the cost for advertising.

I am proud the say that I have found the secret to success in Google Adwords as ‘conversion tracking’, which is where I spend most of my time when tuning and optimizing an Adwords campaign.

-Nils Rognerud100_1097_w-300x281
Google Adwords Consultant
San Francisco Bay Area

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