Home Business Tools Exploring Google Ads Pricing: How Much Should You Spend on PPC?

Exploring Google Ads Pricing: How Much Should You Spend on PPC?


Do you know how much is the Google Ads pricing these days? It’s a reasonable question, and one we hear all the time, especially from newcomers to paid search. After all, you’ll want to know whether you can afford it. The good news is, you can and here is a detailed explanation of google ads pricing.

What is the Google AdWords Auction?

Google Ads auction determines your Google ad placement and the cost you are willing to pay for your selected keywords.

Inside the Google Ads auction, advertisers ad ranks determine the placement of their ads and the Google Ads cost per click they will have to pay.

The ad rank of your advertisement is based on your ad quality and maximum current bid for that keyword.
Of course, your competitors bids are outside of your control, however you can work on your ad quality.

By keeping an exemplary ad quality score, you can spend less on Google Ads cost yet still get a higher ad position. You can also take advantage of tools such as callout extensions that can add to the appeal of your ads once they are posted. 

How Much Should You Spend On Google Ads?

In 2022, the average Google AdWords cost per click is about $1 to $2 on the Google Search network. Some newer niches may still see lower costs, while more established businesses, might see higher cost-per-click averages.

As a rule, your cost-per-click is contingent on factors such as your type of industry, current trends and your product or service costs. Google Ads pricing is extremely subjective, depending on the expected revenue you will generate from a newer customer. 

For example, businesses in the real estate, legal or accounting industries may gain $1000 to $10000 per new client, so spending $40 per click on a Google Ad is well worth the investment. For industries where the profit margin is lower per customer, it might not be worth spending more than $1-$2 per advertisement.

google ads pricing
Google ads pricing page

In highly competitive industries that generate more revenue per client, companies are typically willing to spend $10 per click on average. It is important to understand the relative value between your per-customer-revenue and how much you can spend on your Google Ads campaign.

If you are just starting to run Google Ads campaign, it is a good idea to begin conservatively.  The best way to ensure you don’t overspend on Google Ads is with a low daily budget.

Once you get some data to see the results of your ad campaigns, you can later increase this when you start to see a better return on investment (ROI).

This is a huge benefit of online advertising. With conventional print ads, you cannot test as effectively. But with online pay-per-click ads, you can keep tweaking and adjusting as much as you like, and seeing what gives you the best return on investment.

Before you consider spending any money on Google advertising, its important that you first:

  • Create attention-grabbing, high-quality ad copy
  • Do keyword research based on what your customers and prospects are clicking on in your industry
  • Work on your landing pages for your products and service offerings, so that they convert well once a person clicks
  • Observe what it working for your competitors in your space, and find ways to create similar or more compelling offers

What Is The Ideal Budget For Google AdWords?

The vast majority of Google’s revenue is based on the success of Google Ads. For this reason, they have a lot of tools to help businesses who want to advertise on their platform.

To help you decide on your budget and Google Ad Words cost, you can use the Ads Cost Calculator. Google AdWords offers a budget control features that allow you to adjust your cost of Google Ads each day.

Budget For Google AdWords
Budget For Google AdWords

View your cost and payment history

Your Google Ads account’s billing “Transaction history” page provides easy access to your billing information. View current charges, payment details, and much more. Learn more about how to access your billing information

View Costs from Reports

While your Transactions page shows you monthly accrued costs for each campaign, you can view daily costs for one or more of your campaigns – or even your entire account – by viewing your Billed cost report.

With this report, you can also check your served cost versus your billed cost for each campaign. The served cost is the cost of all the clicks or impressions that the campaign received.

The billed cost is the actual amount you’re responsible for paying, after adjustments have been made to your account for items like overdelivery, invalid activity, and more.

Once you know the typical return you will earn from a new customer purchasing from you, the Google Ads Cost Calculator can generate how much your return on ad spend (ROAS) would be. This calculation can help you determine if the cost of a particular Google ad is too expensive.

With this tool, you can assess whether increasing your ad spend by a certain percentage will generate more money or incur losses.

Another great benefit of the Google Ads Cost Calculator is that it can also deliver estimates of relevant data, such as the number of sales per month, gross revenue per month, gross profit per month and your return on advertising investment.


As we’ve stated throughout, there are numerous factors that can have a significant impact on the cost of running a PPC campaign, but remember: almost any type of business can make Google Ads work for them! 

If you found it hard to understand some of the terms used in this article, checkout out blog on 12 Common Google Ads Terminology You Should Know About.



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