How Much Does Google Ads Cost in 2023?

How Much Does Google Ads Cost in 2023?

Google Ads costs anywhere from $1000 to $10,000 per month with an average cost-per-click (CPC) of $1 to $2 for the Google Search Network and $1 for the Google Display Network in 2023. Google Ads pricing can vary depending on various factors, like your industry, campaign targeting, and ad network.


Looking to learn more about how much Google Ads costs and how to optimize your ad spend? Just keep reading this Google Ads pricing guide!

If you’re looking for professional help managing your ad spend on Google Ads, contact us online to learn how our award-winning team can help!

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How much does Google Ads cost in 2023?

Google Ads costs anywhere from $1000 to $10,000 per month with an average cost-per-click (CPC) of $1 to $2 for the Google Search Network and $1 for the Google Display Network in 2023. Google Ads pricing can vary depending on various factors, like your industry, campaign targeting, and ad network.

How does the cost of Google Ads differ by industry?

So now that you know the answer to the question, “how much does Google Ads cost,” let’s dive into how those costs can vary by industry.

Even though most companies spend $1000 to $10,000 per month on Google Ads, they use their ad spend in different ways. Factors like their industry, products, services, and competitors all influence their Google advertising costs.

For perspective into your industry, check out this breakdown of CPC rates on Google Ads:

INDUSTRYAVERAGE CPC (SEARCH NETWORK)AVERAGE CPC (DISPLAY NETWORK)
Advocacy$1.43$0.62
Auto$2.46$0.58
B2B$3.33$0.79
Consumer Services$6.40$0.81
Dating and Personals$2.78$1.49
Ecommerce$1.16$0.45
Education$2.40$0.47
Employment Services$2.04$0.78
Finance and Insurance$3.44$0.86
Health and Medical$2.62$0.63
Home Goods$2.94$0.60
Industrial Services$2.56$0.54
Legal$6.75$0.72
Real Estate$2.37$0.75
Technology$3.80$0.51
Travel and Hospitality$1.53$0.44

In most cases, industries with a higher CPC spend more on Google Ads.

The consumer services sector, for example, pays an average of almost $7 per click, which can move businesses in the industry to increase their monthly Google Ads spend.

What factors determine Google Ads pricing?

Google Ads costs depend on several factors, including:

Industry

One of the biggest factors that influences Google Ads pricing is your industry. Certain industries are more competitive than others. For example, legal, accounting, and real estate industries have some of the most competitive keywords in Google Ads, which means you’ll need to pay a higher CPC.

Consumer and online advertising trends are constantly changing, so it’s essential to keep up with the latest changes. Your audience’s needs and shopping trends may change overtime, which means you might need to alter your keyword bidding strategy.

The average CPC may go up or down overtime as well as consumer trends shift, making some keywords more competitive than others.

Quality Score

Google Ads costs are also influenced by your ad’s Quality Score. Quality Score is a measurement of your ads’ quality and relevance. It usually ranges from a score of 1-10 and evaluates your ads’ landing page experience, keywords and click-through rate (CTR).

The goal is to have a Quality Score as close to 10 as possible. A higher Quality Score means that Google sees your ad as relevant and providing an experience that helps users, helping you get a higher placement in the SERPs.

Your Quality Score can affect how much you bid on keywords, because a lower bid plus a high Quality Score can help you earn a higher rank in the search results. If you have a lower Quality Score, you may need to place a higher bid to earn a top spot.

Keywords

Like we mentioned before, some keywords are more competitive than others. That’s why your keyword choice can be a crucial factor in determining how much you’ll spend on Google Ads.

Depending on your industry and the keywords you want to target, you could spend a higher or lower CPC than the average business.

Bid

Another factor that can determine Google Ads pricing is your bid amount. Your bid is the maximum amount you will pay for a click on your ad. You can set this amount to whatever fits within your advertising budget.

It’s important to note that you’ll want to set a bid that’s high enough to compete with other bidders.

Budget

Your budget can also influence the cost of Google Ads. Your budget is the average daily and monthly amount you’ll spend per ad campaign. Just like your bid, you can set this amount to whatever fits comfortably within your advertising budget.

How does Google Ads determine your CPC?

When it comes to Google Ads pricing, there are a few factors that determine your CPC. You won’t always pay your maximum bid amount.

With that being said, let’s dive into the three steps that determine Google Ads cost-per-click:

1. Quality Score

Before Google determines your CPC, it will give you a Quality Score. We mentioned Quality Score earlier, but let’s go over a quick refresher.

Your Quality Score ranges on a scale from one to 10 determined by your ad’s landing page and its experience and relevance to the keyword.

Once Google has determined your Quality Score, it moves on to your Ad Rank.

2. Ad Rank

Google will now calculate your ad’s Ad Rank. Your Ad Rank determines where your ad will appear in the search results, if at all.

Google calculates your Ad Rank by using the following formula:

Max bid X Quality Score = Ad Rank

Ads that have the highest Ad Rank will earn top spots in the search results.

3. Cost-per-click

If your ad gets shown in the search results, you’ll only pay when someone clicks on it. However, you won’t always pay the maximum bid you set.

Google Ads determines your CPC with this formula:

Ad Rank of the ad below yours / Quality Score + $.01 = CPC

This formula makes it possible for companies with smaller advertising budgets to compete with larger businesses on Google. For example, you could pay less per click than another company who ranks below you because your ad has a higher Quality Score.

How does Google Ads budgeting work?

When you start advertising on Google, you’ll come across several terms related to Google Ads costs, including:

  • Budget: The amount you’re willing to spend over 30.4 days for a campaign on a per-day basis.
  • Bid: The amount you’re willing to spend for a click on your ad.
  • Spend: The amount Google deducts from your budget when an ad wins an ad auction.
  • Cost: The actual amount you pay for a click on your ad.

Daily average budgets

Your daily average budget is the average daily amount per ad campaign you’re willing to spend over 30.4 days (the average number of days in a month).

When you set up your campaign in Google Ads, you’ll be asked to provide your daily average budget. You can choose to share this budget across all of your campaigns or set a separate budget for each campaign.

Your daily average budget gives Google a rough idea of what you’d like your daily spend to average out at the end of the month. That means you could exceed or fall short this amount.

Spending limits

There are two types of spending limits — the daily spending limit and the monthly spending limit.

The daily spending limit is the maximum amount you will pay for an ad campaign daily. And the monthly spending limit is the maximum amount you will pay for an ad campaign each month.

You will never pay more than your spending limit.

Bidding

The pricing of Google Ads will also depend on your bid. Your bid is the maximum amount you’re willing to pay for a click on your ad.

You’ll want to make sure your bid is high enough to compete with other bidders to earn those higher positions in the search results.

You can choose to bid manually and set different bid amounts for each keyword in your ad group or set up automated bidding where you can set maximum bid limits.

What is the average CPC for Google Ads?

The overall average CPC in Google Ads is $1 to $2 on the Google Search Network. On the Google Display Network, the average CPC is $1.

How much do small businesses spend on Google Ads?

When it comes to Google Ads pricing, it can be helpful to understand what other small business typically spend on Google Ads.

In general, most small businesses spend anywhere from $1000 to $10,000 per month on Google Ads.

What other Google Ads costs can I expect?

Typically, businesses can expect the following costs from Google Ads:

PRICING FACTORAVERAGE COST
Ad Spend$9000 to $30,000 per month
CPC (Google Search Network)$1 to $2 per click
CPC (Google Display Network)$1 or less per click
Professional Google Ads Management$350 to $5000 or 12-30% of ad spend per month
PPC Management Tools$15 to $800 per month

Professional PPC management

When businesses invest in PPC, it’s not uncommon for them to partner with a PPC agency.

A PPC agency, like WebFX, develops, launches, and manages your paid advertising campaigns on platforms like Google Ads and Microsoft Advertising, plus helps improve your Google Ads optimization score.

As a part of leading and managing your PPC campaigns, your PPC agency will charge a monthly management fee. This rate ranges from $350 to $5000 per month and does not include your monthly ad spend.

In some cases, your agency’s management fee will be a percentage of your ad spend. The average, for example, is 12 to 30 percent of a company’s ad spend. So, if you have an ad spend of $5000 and your agency requires 12 percent of your monthly ad spend as payment, you would pay your agency $600 per month, in addition to spending $5000 on ads.

PPC management software

Businesses can also streamline internal PPC management with free and paid PPC software, like WordStream, Shape, or Acquisio. While optional, these tools can help your company optimize bids, evaluate ads, and more.

If you opt for a paid PPC management tool, prices range from $15 to $800 per month. Now that you have a background in the basics of Google Ads’ costs, are you ready to learn more about the platform and the ad auction that influences how much Google Ads costs your business? Just keep reading to get started!

Need help creating your Google Ads budget?

While most companies spend $9000 to $10,000 per month on Google Ads, there isn’t a definitive answer to the question, “How much does Google Ads cost?” and that’s for good reason.

How much you spend on Google Ads is entirely up to you. The right Google Ads spend for your business depends on numerous factors, including ad performance, your industry, your goals, the tools you decide to use, and more.

Whatever approach you decide to take, Google Ads is a fantastic advertising method for almost any business out there. Worst case scenario, you might lose some of your budget on an unsuccessful test campaign.

But when you realize what you stand to gain from a successful Google Ads campaign, you’ll be asking why you didn’t give it a shot sooner! If you’re looking for help building your Google Ads budget, as well as developing your campaign, our PPC management services for Google Ads can help.

Just contact us online or call us at 888-601-5359 to speak with an experienced strategist about Google Ads pricing for your business!

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