Did you know? The search advertising market in Australia is continuously growing with an estimation of reaching the revenue share of $7.0 bn by 2028 as per Statista. It’s because Google Ads not only provides significant results to Australian businesses but also promises immediate return on investment.
But the underlying question is “How much does Google Ads cost?”
If you’re launching your first ever campaign, it is practical to ask such a question. Even many Australian business owners who have been running ads for a long time are sceptical about Google Ads price per month. The cost of advertising on Google AdWords can range anywhere between AUD $2 to $5 per click but it can go up to $50 or more as well. Why such a huge difference?
As an expert digital marketing company in Australia offering Google advertising services in Australia, we’ve come across this question many times. The variation is because there are numerous factors impacting the Google Ads cost per click.
You might even have seen many brands stepping back because of exhausting their marking funds without getting expected results. This can be due to not setting up a strategically planned Google AdWords cost and budget.
If you’re also facing the same challenges or want to have a better understanding of Google Ads pricing, this insightful blog is for you. We have provided everything you need to know about Google advertising cost.
What are Google Ads?
Google Ads is a pay-per-click platform where you can advertise your service or product. Here, you can create ads in different formats and bid on targeted keywords. You can choose any keywords from short-tail or long-tail that works best for your advertisement.
Before making your ad live, you need to decide the maximum cost-per-click amount you are willing to spend. Google advertising is same as an auction happening in real time. When you bid higher for specific keyword compared to your competitors, Google displays your ad at the top of search results.
This advertisement looks like the other search results except for ad or sponsored written next to it. And do you know what’s the best part?
You only have to pay when a user clicks on your Google Ads. But to run a successful campaign on this platform, you need to set the right budget. Let’s now head directly to our core topic that how much do Google Ads cost in Australia.
Factors that Influence Google Ads Cost
There is no fixed or predetermined Google Ads pricing per month. So, how much does Google Ads cost in Australia depending on several aspects of your business? Here are the factors that significantly influence your overall costing of Google advertising,
Industry
Industry is the biggest factor that determines Google Ads cost. It is because some industries have high value customers and so companies in that sector bid more than others.
For example, legal services and insurance industries typically have high cost-per-click rates due to the substantial value of a single customer. In contrast, less competitive industries like small retail shops may experience lower CPC rates.
For instance, the average CPC for the legal industry can reach up to AUD $50 or more, whereas the retail industry averages around AUD $2. This cost variation is due to the competitive nature and high customer lifetime value in certain sectors, driving advertisers to bid more aggressively for top positions.
Market Competition
You won’t be the only one in your industry to run Google Ads. There will be other competitors too. So, how much does Google Ads cost in Australia for your business depends on how much other companies are spending at the time you are running your advertisement.
The higher the advertisers in your industry will bid, the higher cost-per-click you will have to spend for top ad position. This will drive up your overall Google Ads pricing.
Location Targeting
The geographical location where you are targeting your ads directly impacts the pricing of Google AdWords advertising. It is due to the varied cost of living and service demands at different places.
If you’re targeting your ads for a location where the demand is high, but the service providers are less, then your Google Ads cost will be comparatively low. Contrary to that, running your advertisement for a location with more businesses targeting, then you might have to spend more of your Google Ads budget.
For example, CPC for a search query “best cafe in Melbourne” will be high whereas for “the best cafe in Perth” will be low.
Customer Life Cycle
Now this is one significant factor that at what stage you are targeting your consumers. The keywords you target reflect what stage of the customer life cycle your ads will be visible to.
An ad campaign you run for consumers at the beginning phase of the sales cycle will cost less. On the other hand, when you launch a Google Ads campaign for customers who are ready to make purchase, its cost will be on the higher end comparatively.
For instance, a user searching for “how to choose right trekking shoes” can be considered to be in awareness stage. While someone searching for “buy trekking shoes” can be in the final decision stage.
Seasonal Trends
Seasonal trends can directly impact cost of Google AdWords. It is all about the time of the year when your specific product or service is in high demand, resulting in a surge in demand for ad space.
If you’re in the travel industry, you can see increased Google Ads cost per click rates during summer and spring break as they are the peak tourism seasons. Whereas if you own a retail gift store, you might experience a higher CPC rate for keywords like “Christmas gifts” in November and December.
These seasonal changes will require you to carefully place your bids and adjust your budget to make sure you acquire ad space during these high competition times.
How does Google Decide Your Ads Cost-Per-Click?
Although Google Ads runs as an auction for the advertisers, it is not necessary that the one who bids maximum wins. There are several factors that determine your Google Ads cost-per-click.
Quality Score
When any of your potential customers searches for any query, Google will see who else other than you are bidding for that specific keyword. If there are several advertisers, then there will be an auction between all the relevant ads.
Firstly, Google will assign you and other related advertisements a Quality score. This is a metric Google determines based on relevancy and quality of your keywords and landing page. You will be scored from 1 to 10 depending upon expected click-through rate and your previous performances.
It is always best to achieve a higher Quality Score as it can lead you to pay lower CPC rates with better ad placement. But if you get a lower score, then you will have to bid with increased Google Ads cost-per-click to get your ad positioned.
Ad Rank
Once Google assigns your Quality Score, it will then calculate your Ad Rank. It is for deciding where your Google Ads will be placed if it makes place in the ad space.
Ad Rank is calculated by multiplying your Quality Score with the maximum amount of bid you are willing to pay. If you are ready to pay a higher Google Ads cost per click with a good Quality Score, then there are better chances of your ad getting placed at the top.
For an ad placement with maximum profits, it is always best to have the highest Ad Rank amongst your competitors.
Competitor’s Bid
As mentioned earlier, you won’t be the only one to run advertisements. Your competitors will also be placing their bids, and this can impact on your Google Ads cost.
If there are multiples advertisers bidding on the same keyword as yours, then your cost-per-click rate will be calculated dependent on the ad ranked below you. The formula for Google Ads CPC is the Ad rank of the advertisement below yours divided by your Quality Score plus $0.01.
What is Google Ads Price per Month?
Although this depends on the above associated factors, you can expect to pay an average Google Ads price per month in between AUD $1000 to $25,000 or more. This range can fluctuate as per the changing demand of your industry and services.
For the maximum ROI and profitable results, it’s important for your business to set a proper Google Ads budget. Let’s see what it means.
How Google Ads Budgeting and Bidding Works?
Now that you know the factors that influence Google Ads cost and how Google determines your CPC rates, it’s time to understand budgeting and bidding. Many of the times businesses see their entire month’s budget getting exhausted within the first few days.
That generally happens when they are not aware of how Google Ads budgeting works. Let’s begin with going through the common terms related to setting Google Ads pricing.
Budget
The amount you have decided to spend on Google Ads campaign for a specific duration.
Bid
The maximum amount you are willing to spend for per click on your ad.
Spend
The amount Google deducts from your budget when your ad gets selected from the auction.
Cost
The actual amount that you pay for your Google ad when a user clicks.
Daily Average Budgets
When you set up your ad campaign on Google, you’ll be asked to define your daily budget. It is the average amount you’re willing to spend on your daily basis over the duration of an entire month.
Google Ads provides a shared budget feature but it’s advisable to keep separate daily budgets for each of your campaigns. Defining your daily budget doesn’t mean Google will spend the exact amount you have given.
It just gives an approximate idea of how much Google Ads cost you want to spend daily on an average over the month. That means on some days Google can either exceed the daily amount you have specified or use less amount depending on spending limits. This brings in the next question, what is spending limits?
Spending Limits
The spending limit is the maximum amount you will be billed for in a day or a month. Google can spend up to 2x the amount you have provided for your daily budget. It cannot spend more than that. If it spends more mistakenly, then it won’t be charged from your balance.
That simply means it is crucial to set the right budget so that the average spending limit reflects effective results at end of 30.4 days. Your monthly spending limit is the maximum budget you have set for your Google ads campaign cost.
Bidding
Now, let’s understand bidding as how much does Google Ads costs will also depend on the bid you have placed. As mentioned, this is the maximum amount you’re willing to pay for a single click on your ad. Never bid too low or too high while advertising.
There are two ways you can bid – either manually or automated.
To bid manually, you need to set one maximum cost-per-click for each ad campaign. Also, there is an option to set individual bids for different keywords in the same ad group.
In automated bidding, you can set maximum bid limits. Here you can define for maximize result in different strategies like clicks, target impressions, acquisition and ROAS. But in case when Google thinks that your ad is bringing in value and profits, it can even spend more than your maximum CPC, but that’s only when you are gaining returns.
How to Determine Your Average Daily Budget?
To determine your daily budget, you can simply divide your entire campaign’s monthly budget by 30.4. However, there are several aspects you need to consider before deciding your monthly budget. You can ask questions such as,
- How much are you able to spend in total on your specific Google Ad Campaign?
- How much are your competitors bidding for the keyword you want to target?
- Is this campaign profitable compared to your other campaigns?
Answering these questions will help you set your monthly budget. Doing it all by yourself can be complex and lead you to lose your valuable funds. Consider partnering with a Top PPC company in Australia like Vrinsoft to help with setting up a profit-making Google Ads pricing budget.
What is the Average Cost-Per-Click in Google Ads Pricing?
There is no specific answer to this question. As it can vary based upon several factors mentioned. But in addition, keywords and intent of the campaign also influence Google Ads pricing.
The average CPC across all industries is approximately $2.69 on the Search Network and $0.63 on the Display Network as per Business of Apps. However, highly competitive industries such as legal and finance can see CPC rates as high as $50 or more.
This average pricing of Google Ads can differentiate if there is a change in market demands or other ruling aspects.
Wrapping Up - How Much Does Google Ads Cost in Australia
An in-depth analysis of numerous factors, including industry and market competitiveness, is necessary to create a budget for your cost of Google Ads in Australia. The average Google Ads cost per click can range anywhere between AUD $2 to $5 and in more competitive industry like finance, even up to AUD $50 or more. It is crucial to optimize your Quality Score, maintaining Ad rank and choosing the appropriate bidding strategy.
Following this guide and partnering with an expert PPC company in Australia like Vrinsoft will help you successfully manage your Google Ads cost spending and increase your ROI. However, you can see variation in your Google PPC charges depending on your individual business objectives and ad targeting.
Partner with Vrinsoft for Achieving Maximum ROI against Google Ads Cost
As a top PPC company in Australia, we can navigate you through Google Ads’ complexity so you may get the most return of your advertising spends. We have a team of experienced Google AdWords specialists who are dedicated to bringing in maximum profitable results for each of our clients using the latest trends and tools.
If you’re ready to take your Google Ads campaigns to the next level, contact us today for expert assistance.
Google Ads Cost FAQs
Still have doubts about Google Ads pricing? We understand your concern, so we have answered some of the most asked questions below,
What is the average cost per click in Australia?
The pricing of Google Ads can vary widely based on industry, competition, and campaign goals. The average cost per click in Australia ranges anywhere between AUD $2 to $5 and in more competitive industry like finance or legal, even up to AUD $50 or more.
How does Google charge for PPC Ads?
Google charges for PPC ads based on a bidding system. Advertisers set a maximum bid they’re willing to pay for a click. Each time a user searches, an auction determines which ads are shown and how much the advertiser is charged per click. The actual cost per click is determined by the competitiveness of the keyword and the quality score of the ad.
How to lower Google Ads costs?
For reducing your Google Ads costs, you can use long-tail keywords, focus on making your ads more relevant, try A/B testing, improve your Quality Score and create a strategic budgeting and bidding for your campaign. Also, it’s essential to monitor and adjust campaigns regularly based on performance to lower your Google Ads cost.
What is a good Google Ads budget for small business?
The budget of Google AdWords can vary widely based on industry, competition, and campaign goals. On average, small to medium-sized businesses might spend between AUD $1,000 to $10,000 per month on Google Ads.
Does different types of advertising format impacts CPC?
Yes, different advertising formats can impact CPC. Search ads typically have a higher CPC compared to display ads due to the higher intent of search users. Video ads, shopping ads, and other specialized ad formats can also have varying CPCs depending on the competition and audience targeting.
