How much does Google Ads cost?

How much Google Ads costs is up to you: you set an average daily budget for each campaign, and with cost per click bidding you pay only when someone clicks your ad. The price of that click is decided in an auction every time someone searches. Your daily budget also caps your ad spend for the month, since Google never charges a campaign more in a month than 30.4 times that budget.

Google Ads used to be called AdWords, so the AdWords cost you may have seen quoted is the same thing. Its ads in Google Search are a form of search engine advertising (SEA): you pay to show your ad when people search for what you offer. Your Google Ads budget can also pay for image ads on other websites and video ads on YouTube.

How Google Ads charges you

How you pay depends on what you bid for. If you want people to visit your website, bidding for clicks is a good place to start.

Google Ads pricing models compared

When you set your own bids, you choose a maximum bid, the most you'll typically pay for a click. A click can still cost more than that. A bid adjustment, which raises or lowers your bid by a percentage depending on where, when or how people search, can take it higher, and so can automated bidding, where Google sets the bids for you.

How your daily budget sets your monthly bill

You control the total through the average daily budget: the amount you're comfortable spending per day on a campaign, on average over the month. You can change it whenever you like.

On a busy day, Google can spend up to twice your daily budget to catch extra searches, and quieter days even this out over the month. The month as a whole has a ceiling, the monthly charging limit: 30.4, the average number of days in a month, times the daily budget. If your costs still go over that limit, Google credits the difference back to your account.

At £10 a day for a whole month, the most that campaign's ads can cost you is £304, and a single busy day never costs more than £20. If you'd rather plan in months, divide your monthly budget by 30.4 to get the daily figure.

For ads served in the United Kingdom, Google adds a 2% UK DST fee to your invoice, driven by the UK's Digital Services Tax. The fee comes on top of your ad spend, and any VAT that applies is charged on the fee as well.

What decides the price of a click

Clicks have no fixed price, but you can see what yours are likely to cost before you spend anything. Google's Keyword Planner shows you that for each of your keywords: what you'd pay on average to have your ad appear when people search for it, and how often they search for it. What you then actually pay per click comes down to the auction, the quality of your ad and the demand for your keyword.

The ad auction and your maximum bid

Every time someone searches, Google runs an auction to decide which ads appear and in what order. Your Google Ads campaigns enter it with your maximum bid, also called the maximum cost per click (max. CPC). Google combines that bid with the quality of your ad, the context of the search and a few other factors into your Ad Rank, which decides whether your ad shows and where.

What you pay is often less than your maximum, sometimes much less, because you pay only what it takes to beat the Ad Rank of the advertiser directly below you. Position has a price too: ads above the search results often cost more per click than ads below them, but they usually get more clicks as well.

Ad quality and Quality Score

A better ad can cost you less. When Google works out your Ad Rank, it looks at how likely people are to click your ad, how closely it matches what they searched for and how useful your landing page is once they arrive. Relevant ads and helpful pages can lower the price you actually pay per click, and they can win you a higher position than a competitor who bids more.

Google sums up those three things in a Quality Score from 1 to 10 for each keyword. The score itself isn't used in the auction: it's a diagnostic that shows whether your ads, keywords or landing page could do better.

Keywords, competition and timing

The more advertisers compete for the same searches, the more a click on them tends to cost. Good keyword research shows you which words your customers actually use, before you pay for any of them.

The location of the person searching and the time of the search are also part of the context Google weighs in every auction. You decide where and when your own ads appear with the location and ad schedule settings further down.

How much should you spend on Google Ads?

There's no right amount, and Google doesn't set one. The right first budget is one you can afford to test with: check in Keyword Planner what clicks on your keywords are likely to cost, then raise the budget once you can see which searches bring in customers.

It also helps to know what a visitor is worth to you. Work out what you keep from a typical sale or job after your costs, and how many visitors it takes to win one. Divide the first figure by the second: if a job leaves you £200 and it takes about 20 visitors to win one, each visitor is worth £10, and paying more than £10 a click loses you money.

Our advice: start with one Search campaign, a handful of specific keywords and a daily budget you'd still be comfortable with if the ads brought in no new customers at first. Once the campaign has collected clicks, move the money to the keywords that bring in calls or sales and drop the rest. Do the same with your ads: write a few versions with different headlines, and keep the ones that bring in the most customers. A small, focused start shows you quickly how many clicks turn into customers, and that decides whether the ads are worth what they cost.

How to stop wasting your Google Ads budget

Check these settings before you spend, so you don't pay for clicks from people who were never going to buy.

• Negative keywords. Exclude searches that look like yours but are about something else. A plumber might exclude jobs and training, so the ad doesn't show to people looking for work.
• Match types. Broad match, the default, can show your ad on searches related to your keyword, including some that don't contain it. Phrase match and exact match keep your ad to searches closer to your keyword and give you more control over a small budget.
• Location. Show your ads only where your target group is: a country, a region, a city or a radius around your business.
• Ad schedule. Choose the days and hours your ads appear, for example only when someone can answer the phone.
• A bidding strategy that fits your goal. Smart Bidding strategies, such as Target CPA and Target ROAS, set your bids automatically to get conversions or sales value. Target ROAS (return on ad spend) aims for a set amount of sales value for every pound you spend. Smart Bidding needs conversion tracking, and Target ROAS on a Search campaign also needs at least 15 conversions in the past 30 days. So for a brand-new campaign, your own bids are usually the simpler start. Whichever strategy you pick, a target is what Google aims for, not a promise: some results come in above your target and some below.

Make sure the landing page behind each ad is about exactly what the ad offers, loads quickly and is mobile-friendly and responsive.

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Once each service you advertise has a landing page of its own, you're ready to open your Google Ads account. You choose how to pay as you create it, and your country and currency decide which options you get. With postpay billing, you pay after your ads have run: Google charges you whenever your costs reach your payment threshold, and on the first day of each month.

You set each campaign's daily budget as you create the campaign, so choose an amount you're comfortable with and start advertising on Google.