Pay-per-click advertising like Google Ads (previously known as Google AdWords) puts cost control into your hands. However, managing your Ads costs and maximising return on investment involves testing, analysis and regular adjustments
Paying for Google Ads
Pay-per-click advertising (PPC) puts the advertiser in control of their budgets. You can set budget limits - per day and per click-through (each time someone clicks on your ad) - so there's no need for costs to spiral out of control. But at the same time, it's up to you to monitor and refine your strategy to maximise your return on investment.
You can pay for Google Ads with a credit or debit card or via a bank payment. Because you set the limits for how much you spend, you should not get any surprises when it comes to the costs.
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Daily Ads budgets
You can choose to spend as much or as little as you like. You can set a maximum daily limit and change it whenever you like. The daily budget determines how often your ads are shown throughout the day. If your daily budget is low in comparison with the cost of your keywords, then your ad won't appear every time it is searched for.
Google publishes extensive online help for managing Google Ads. There are also free tools to help you get the most out of your ad campaigns. If you commit to a budget of £6 per day, Google will provide additional support - with setting up, creating your ads and optimising your campaign - for free.
Maximum cost per click
What you pay depends on the keywords you select: some keywords are more popular than others. You bid for how much you are prepared to pay.
By setting a maximum CPC (cost per click) bid, you limit the amount you are prepared to pay per click on your advert. You can set your CPC bid for ad groups or for individual keywords.
Setting your cost per click bid
You need to determine how much you are prepared to pay for a click. Ask yourself:
- How much is it worth for someone to visit your website?
- How likely is it that a click will turn into a conversion, such as a sale or a sign-up?
- How much is a conversion worth?
Your position in search results
Where your ad appears in the list is affected by how much you bid. It is also affected by Google's assessment of your ad's quality, including:
- how relevant your ad is to the search;
- the landing page on your website that the ad links to;
- expected click-through rate.
You can see an estimate of your 'Quality Score' in your Google Ads account. High quality ads and landing pages can reduce your cost per click and get your ad in a higher position. Making sure ads and landing pages are relevant to the keywords you are bidding for is absolutely critical.
Track results and refine your Ads strategy
Study your results to get the most out of your Ads budget. Return on investment (ROI) is the crucial benchmark.
To assess the profitability of a keyword, you can track conversion rates and cost-per-conversion with Google's conversion tracking tool. You can also use Google Analytics for advanced analysis of ROI. With this conversion data, you can identify unprofitable ads and keywords, and then improve or delete them.
Everything can be tested and tweaked - keywords and phrases, how much you bid, your budgets, your ads and your website. Control your testing carefully. Make small changes and let them run for a few days, so you can evaluate the results properly.
Compare the results you get with other options, like Microsoft Advertising, other types of online advertising and your other promotional activities. Focus your spending on the marketing tactics that deliver the biggest impact.