Google Ads is used in today’s market economy more than ever before. For newbies though, it can be intimidating to use for the first time not just because of the overwhelming number of tools at their disposal but because they wonder how much Google AdWords cost.
The answer is somewhat difficult as there are various facets that determine the cost. Location, keywords, product type, and your initial budget are just a few factors that are considered when the cost of your ads is calculated.
While it is a complex system, understanding how Google Ads works will give you a better understanding of how the system works out these costs. We’ll be explaining:
- How to create content that you can advertise well
- What the Google Ads auction system is
- How to boost your ad placement to achieve the best results
Without further ado, let’s jump right in.
Creating Content for Google Ads
Content that is advertised through Google Ads is judged, in a sense. Basically, Google’s algorithm deems certain content more valuable based on several factors. Most of these are kept a secret, but many are well-known and some are common sense. If you learn to play along with the algorithm, you can have it position your ads higher and also lower Google Ads costs.
Location is one of the biggest factors that contribute to the amount, and type, of traffic that your ads will receive. Google rigorously tracks where in the world users are searching queries from. Because of this, you can target people in specific locations – from the country level to the state level, all the way to the city level. This can impact the cost of Google Ads depending on where exactly and how specific you are with your targeting.
Keyword placement is another determining factor that needs to be considered. Google recognizes the types of keywords that you use in your content and this plays a key role in calculating the cost.
When selecting keywords you need to think about what people are searching for. A handy tool for doing this is the Keyword Planner.
Using this tool helps to come up with new keywords to target by showing data such as how many monthly searches they get and how competitive they are. More competition equals higher Google AdWords cost, so try to avoid those when you’re on a tight budget.
Our advice: go for low hanging fruits. These are keywords which have:
- Low competition
- Average search volume (around 500-2000 searches is worthwhile)
- Low CPC
By going for these types of keywords you can save a lot of money and score an easy win. We also need to account for the popularity of certain keywords.
Popular subjects (such as insurance, mortgages, or loans) receive far more searches than others. As a result, they’re much more competitive and bidding on them will increase your costs.
Google Ads Auction System
Another important part of understanding Google Ads is the auction system. This system utilizes two parts to determine the Google AdWords cost: the initial bid price and Google Ads Quality Score.
Your initial bid price is exactly what it sounds like – it’s the amount that each advertiser initially bids on their ad placement. In a normal auction, the highest bidder will always win, but this isn’t always the case. Because Google Ads factors in your Quality Score, it’s not as simple as bidding the most.
So, what is the Quality Score? This is a numerical value that Google’s algorithm uses to rate the quality of your ads’ content relative to other ads of that nature. Google bases this on keyword usage, ad placement, and the relevance of your ad copy to the keywords you’re bidding on.
If your ads perform well over time then this will also help to improve your Quality Score. By putting in the effort and just running professional-grade ads with high-quality ad copy, you’ll boost your score significantly.
Now, if you continue running great ads (low-quality ads will hinder your progress), you will boost your Quality Score but your CPC will also be lower. Thus, your Google AdWords costs will decrease.
How to Boost Ad Placement
This leads us on to ad placement, and next we’ll be looking at how to boost yours. Advertisers with a higher Quality Score are more likely to win the top ad placement on Google than those with lower scores. This can be a good and bad thing.
On one hand, having a high Quality Score provides an advantage over competitors (which some may say is unfair). But on the other hand, this provides small businesses the opportunity to come out on top if they take the time to refine their ads and increase their Quality Score.
So, the key to boosting your ad placement is to increase your Quality Score. As we said before there are many factors that go into calculating this score. It can take time but if you work on improving your score, this will get you better placements and in turn, it’ll help you cut down on Google Ads costs.
How Much Does Google AdWords Cost?
As you can tell this isn’t an easy question. Everyone’s Google AdWords cost is different and there are a lot of different considerations to be made. Your industry is one of the top factors but there are plenty of others.
It could be argued that running Google Ads can cost as much or as little as you want them to. This is true, but then we have to take into account how efficiently your budget is being spent. Some small businesses can get away with a monthly budget of $1,000 but if you want to get the most out of your money, a minimum of a few thousand is ideal.
If you’re taking in all of this information and it feels overwhelming, let KonvertLab help. Our team has experience with running Google Ads in various industries and we can easily adapt our strategies to grow your business. All you have to do is click the button below, book a call with us, and let us show you how we can help.