How Much Should I Spend On A Google Ads Campaign?

Understanding how to allocate your Google Ads budget effectively can seem like a daunting task. But with the right guidance, you can navigate this labyrinth with confidence. Whether you’re seeking to boost sales or generate leads, one question continually surfaces: What budget is necessary to tap into the power of Google Ads effectively? 🎯💰

In this comprehensive guide, we’re going to demystify this complex question. We will be offering you two robust strategies that will give you the insight you need to define your Google Ads budget.

Before diving into these strategies, it’s crucial to understand what you’re paying for when advertising with Google.

Understanding Google Ads Charges 💸

Google Ads operates on a pay-per-click model, meaning you get charged every time a user clicks on your ad. The cost per click can vary significantly, primarily depending on two factors:

Your Industry: The nature of your business plays a significant role in determining the cost. For example, the cost per click for a roofer might range from £1.20 to £5, whereas a website developer could see a spectrum between £6 to £20.
Your Location: Your geographical targeting can also influence the cost. Advertisers targeting highly competitive locations may find higher costs per click than those targeting less competitive areas.

Now, how do these costs translate into your daily budget? Let’s consider an example: If you allocate a monthly budget of £300 to Google Ads, this equates to approximately £10 per day. If Google charges £2 per click for a specific keyword related to your business, your daily budget would cater to around five clicks.

So, how can you calculate an ideal budget for your Google Ads campaigns? Here, we’ll look at two scenarios:

Defining Your Google Ads Budget: A Two-Pronged Approach 📊🧮

1️⃣ Starting from Scratch

If you’re stepping into the Google Ads universe for the first time with no prior data or experience, the task of setting a budget may seem intimidating. However, by following a few simple steps, you can determine a starting point.

Firstly, you’ll need to compile a list of potential keywords – these are the terms that your prospective customers might use to find your services or products on Google. Google’s free tool, the Google Keyword Planner, can assist with this.

The Keyword Planner provides an estimated cost per click for your keywords. Suppose it estimates that the word ‘therapist’ will cost between £1.46 and £6.27 per click. This suggests that the minimum cost for all your chosen keywords would be around £95.

Next, decide on the number of clicks you aim to generate. If you want to secure 200 clicks, for instance, your budget would be £190 (200 x £0.95). However, we recommend starting with a minimum budget of £300 to obtain a substantial volume of data and clicks, which will help you quickly identify what’s working and what’s not.

2️⃣ Leveraging Existing Data

If you’re already running Google Ads campaigns and have access to some performance data, you can take a more data-driven approach to set your budget.

The key question here is: how many clicks does it take to generate one lead? Suppose it takes 30 clicks, and the average cost per click is £1.25. Therefore, every lead costs you £37.50 (30 x £1.25).

Based on this, determine the number of leads you desire to generate. If you aim for ten leads, and each lead costs £37.50, your monthly budget should be £375 (10 x £37.50). Remember, the cost of acquiring a customer is just the tip of the iceberg; the customer’s lifetime value (the potential revenue a single customer can generate over time) is a significant factor to consider.

While these strategies provide a solid starting point, they aren’t a ‘set-and-forget’ solution. Regularly reviewing and optimising your Google Ads account is crucial to ensure the continued success of your campaigns.

Ready to Optimize Your Google Ads Budget? 💪📲

Whether you’re embarking on your Google Ads journey or looking to optimise your existing campaigns, we’re here to help! Dial us on 07866 555 555 for a free Google Ads Audit or to seek assistance with your Google Ads strategy.

Together, we can unlock the power of Google Ads to drive more leads, boost your sales, and ensure your business thrives. Let’s get started today! 💼🚀