Is Google Ads Cheaper Than Facebook? The Definitive Comparison

 

In the rapidly evolving world of digital marketing, Google Ads and Facebook Ads stand as the colossi, each offering distinct advantages and cost structures. The question remains: which platform offers more value for your money? Let’s dissect these advertising giants to give you a clearer picture.

 

The Fundamentals of Cost in Google Ads

When it comes to advertising on Google, a variety of factors come into play. These include industry type, keyword selection, geographical targeting, and competitive landscape. Usually, businesses bid for keywords that resonate with their target audience. The average Cost Per Click (CPC) is between £0.50 to £2. In competitive sectors like finance or law, CPC could skyrocket to £50 or more.

Industry-specific Examples: In the technology sector, keywords such as “cloud services” may fetch a CPC of around £10. For retail, “women’s winter coats” might cost approximately £2 per click.

 

Quality Score: A Cost Determinant

Google uses a metric known as the Quality Score to determine your ad cost. The Quality Score is not just a mysterious number; it has a huge effect on your advertising success. It is determined based on Click-Through Rates (CTR), ad relevance, and the landing page experience. A higher Quality Score means you could pay less for a higher ad placement.

Why it Matters: A Quality Score of 6-10 can potentially lower your CPC by 16-50%. On the flip side, a score of 1-5 could increase your costs by 16-400%. We generally advise to have your quality score at 7+

 

Flexible Budgeting Options

Google Ads offers two budgeting systems: Daily Budgets and Shared Budgets. These options provide organisations with the flexibility to either allocate a fixed budget per campaign or distribute it across several campaigns. A daily budget could be as low as £5 for small businesses or as high as £1000+ for large businesses.

Example: If you have two campaigns—one for brand awareness and another for product sales—you can allocate £20 daily for the former and £300 for the latter. We generally recommend a daily budget of at least £10 per day per campaign. This ensures your campaign has  a good chance of getting a decent amount of clicks which you can then use to determine your conversions,

 

The Intricacies of Cost in Facebook Ads

Facebook Ads differ from Google in many aspects, including cost determination. Factors like demographics, ad placement, and industry sector contribute to your final bill. Facebook relies more on audience interest for its bidding model, rather than keywords.

Examples: In the fashion industry, targeting young adults in urban areas might cost around £1 per click, while a niche B2B market might reach £5 per click.

 

Ad Relevance Diagnostics

Facebook employs Ad Relevance Diagnostics to evaluate your ad’s efficiency, looking at engagement rates, conversion rates, and quality ranking. A better ad relevance score generally leads to a lower cost per action (CPA).

Importance: High relevance can decrease your costs by as much as 20%, making your ad campaign significantly more efficient.

 

Budget Optimisation Tools

Facebook gives advertisers the liberty to set either a daily budget or a lifetime budget. The platform also has a Campaign Budget Optimisation feature that automatically reallocates your budget to the best-performing ad sets.

Example: If you have a £500 budget for a campaign with three ad sets, Facebook will dynamically allocate more funds to the ad set that is generating more clicks or conversions.

 

Direct Cost Comparison: Google Ads vs Facebook Ads

When comparing CPC, Google Ads tends to be pricier than Facebook Ads. However, Google often garners a higher ROI, especially for B2B sectors and high-value consumer products. Conversely, Facebook usually offers a lower CPC but may produce lower conversion rates in specific industries.

Examples: A law firm might find that Google Ads yields a CPC of £10 but a high ROI due to the high value of a converted client, while a fashion retailer might see a CPC of £1 on Facebook with less valuable conversions. Google Ads drives high-intent, in-market traffic to websites.

 

ROI: The True Measure of Ad Spend

The ultimate arbiter of any advertising strategy is the Return On Investment (ROI). Google Ads often delivers higher ROI in B2B industries and luxury consumer goods, while Facebook excels in B2C sectors that benefit from visual content.

Example: A tech company might enjoy a 200% ROI on Google Ads, while a food delivery service may achieve similar ROI metrics on Facebook due to its strong visual appeal.

 

So, Which is Cheaper?

When it comes to costs, the term “cheaper” is relative. You should focus on maximising the total value derived from your ad spend. Align your goals—whether it’s brand awareness or lead generation—with the platform that offers the best ROI for your sector.

Google Ads does not Replace Facebook, and vise-versa. In fact they complement one another. Ideally you could consider running both platforms to capture your potential customers based on the platform they most use.

Tip: To make an informed decision, conduct A/B tests on both platforms to see which offers better results for your specific needs.

 

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Frequently Asked Questions

 

1. Why is Google Ads generally more expensive than Facebook Ads?

• Google Ads tends to be pricier largely because of its extensive reach and the competitive nature of keyword bidding. The platform gives advertisers access to users who are actively searching for particular terms, which often indicates a higher level of intent to purchase or convert. This heightened user intent is often mirrored in the costs. 
• For example, in the legal sector, keywords such as “personal injury lawyer” could cost up to £50 per click due to the high value of a converted lead. Additionally, Google Ads operates in an auction system, where multiple advertisers may bid for the same high-intent keywords, driving the price up even further.

2. Is it possible to have a low CPC but high ROI on Google Ads?

• Absolutely, achieving a low CPC while maintaining a high ROI is feasible through effective campaign optimisation. Factors such as a high Quality Score can significantly lower your CPC. A Quality Score ranges from 1 to 10 and considers elements like CTR, ad relevance, and landing page quality. By improving these elements, you can reduce your CPC. 
• For instance, if you are in the retail industry and have a Quality Score of 8, your CPC could be reduced by up to 30%. Coupled with a compelling ad that leads to high conversions, this low CPC can yield an impressive ROI.

3. How does Facebook’s ad relevance affect costs?

• Facebook’s Ad Relevance Diagnostics assess various metrics like quality ranking, engagement rate ranking, and conversion rate ranking. A high relevance score can lower your overall costs by making your ad more competitive in the auction. 
• For example, if you’re running a campaign targeting young professionals for a new finance app and you have high ad relevance, you could see your cost per download reduced by as much as 20%. This would make your campaign not only cheaper but also more effective in reaching your target goals.

4. What are the minimum budgets for Google Ads and Facebook Ads?

• The minimum budgets for Google Ads and Facebook Ads are designed to be flexible to cater to businesses of all sizes. Google Ads allows for a daily budget as low as £5. This might be suitable for local businesses targeting a small geographic area. 
• On the other hand, Facebook offers an even lower entry point, with daily budgets starting at £1. However, it’s crucial to note that a lower budget may also result in less visibility and reach. For instance, a local café using Google Ads with a £5 daily budget may only appear for searches within a specific postcode.

5. Can I run campaigns on both platforms simultaneously?

• Yes, running campaigns on both Google Ads and Facebook Ads concurrently is not only possible but often recommended for a diversified marketing strategy. Each platform has unique strengths: Google Ads is excellent for targeting high-intent keywords, while Facebook excels in demographic and interest-based targeting. 
• For example, a travel agency might use Google Ads to target keywords like “last-minute holiday deals” and use Facebook to target users who have shown an interest in travel. By doing so, the business can maximise its reach and potential ROI across different audience segments.