Are Google Ads expensive? And are they worth it?

Are Google Ads expensive? And are they worth it?

These questions are quite complex but can be simplified down to the basics.

Whether Google Ads are expensive or not depends largely on three general factors:

1) How competitive your industry is
2) How well your ads are set up
3) How much the Ad Agency is charging you for your ads

Let’s have a brief look at these three factors in more detail:

1) How competitive your industry is

If your industry is competitive – i.e., if lots of people are advertising under the same terms as you – then your ads will be more expensive than another industry that is less competitive.

2) How well your ads are set up

If you run automated ads in Google, then they will be much more expensive per lead than if you have professionals set up a manual bidding strategy for you. This is because Google Ads obviously maximises its own bottom line and if you leave it to the automated process you will pay the going rate per lead.

3) How much the Ad Agency is charging you for your ads

This is crucial. Ad agencies operate generally in two different ways.

First, you have the less integral operators who simply run automated Google Ads strategies (i.e., this takes them less than an hour to set up).

These companies simply invoice you for the amount they put into Google and add their fees on top. And they are not cost effective. You will pay the same price in Google Ads as you would if you set up the automated process yourself – plus you will pay whatever fee they put on top of it (for doing nothing).

Professional ad agencies with integrity will not do this.

This second group of companies will put the time into setting up a manual bidding strategy and effective targeted ads. This means your ads will look better, be targeted properly, and the CPC (cost per click) will be dramatically lower than the apparent going rate. The difference in results between manual ads and the automated ones is huge. Where the going rate for leads may be between $8 and $30 per click, in a manual bidding strategy you may get the same leads for around $1-$3 each.

In general, we find we can get 10 times or more the number of leads compared to the stated lead price in Google Ads. Which means for you, each lead costs a fraction of the price.

These agencies who operate integrally, will charge you a setup fee for setting up your account and the ads – and an ongoing management fee. But the ongoing management fee should not be expensive once the ads are in place. Depending on the budget you spend on ads, you would expect this to be between $150 to $500 per month.

How can you tell what an ad agency is doing?

This is quite difficult, but the easiest way to stay on top of what an ad agency is doing is to have them set up your ads in your own Google Ads account. This way you can see what is actually spent on ads and you can determine whether the campaign is simply automated or has a Manual CPC strategy in place they have taken the time to construct.

For small operators, however, it is more cost effective to run the ads in the agency’s account, but they still should send you the Google generated reports from the shared account, for the ad spend, so you can clearly see what has been paid to Google (and what they have kept).

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Are Google Ads worth it?

This depends on your industry type and how well your organic SEO is set up.

For our clients who do not have a lot of competition in their target area, generally organic SEO will suffice. But it needs to be set up properly to work; it won’t happen magically somehow on its own. You can read more about setting up organic SEO here.

For larger clients with more competition, Google Ads can be highly effective. We generally recommend them for most businesses with local competition, if only for the first 6 months to a year following site launch, or until organic SEO catches up and suffices.

For larger businesses with ongoing competition, Google Ads is generally a recommended part of an ongoing marketing strategy. Though it does depend on your industry type, as some businesses are better suited to ads on social or other platforms rather than Google itself.