The age-old question 🙂 And there is incredible nuance to this one. How much is a good budget for Google Ads? What budget should someone start with?
I want to cover a few things so that we approach this with the right framework in mind.
Two key things. We don’t wait to wait weeks on end for leads, and we don’t want to blow or waste money!
Ok, let’s dive into three scenarios
- Low Budgets – Google says to start small with as little as $10 a day. One thing about small budgets is it can take a substantial amount of time to gather the right amount of data to make educated decisions.
- Large Budget – With large budgets, you can quickly spend, and if not properly set up out of the gate, you can blow substantial cash faster, but you also get enough data to quickly make decisions to optimize faster.
- Right in the middle – I prefer not to spend the max, or too low. Why? If you can project and find the right starting budget, you can get enough visibility and leads without having to wait weeks for consistent lead flow, while also not overspending and wasting thousands of dollars.
The problem with too little budget
With a low daily budget, you can get as few as only 1-2 clicks a day, sometimes none. It takes lots of patience with a small budget. Google recommends most businesses use their automated bidding to which has driven up costs for my business. (I have found that in 2021-2022) that with auto-bidding, I end up spending 30-50% more.
When I have to start small, I always manually control my bids or use another bid type. With 10+ years of personal experience managing paid ads, this consistently yields me the best results.
This obviously requires a bit of additional work to manually control bids, but you get a lower cost, and more control over the outcomes if managed by an expert.
Rarely do I recommend starting with a budget as small as $10 a day, there are far more effective initial things a business can do that will make a larger and more material impact, but again there is nuance to the situation.
Best practice when starting with a small Google Budget
Here are some great ideas if you are starting with a small Google Ads Budget:
- Radius – start with the top 4-5 zip codes around your business. If you have a Google Maps or Google Analytics set up you can get some simple data to help you decide which areas to start targeting.
- Mobile Phone Calls – if you don’t have a large budget or a great website, maybe your sales team is stellar! Start with call-only ads or local service ads to get the most bang for your buck.
- One Service/One Keyword – Focus on 1-2 top services/keywords to maximize visibility. Create content and landing pages tailored directly for this intention.
- Remarketing – say you have a lot of traffic or do tons of word-of-mouth business, you can start by simply running remarketing/retargeting ads, or display ads
- Creative Solution from your marketing manager – depending on your business’s unique situation, there are custom/craft solutions. If you think this is your business, contact us to discuss a strategy for your business.
Large Google Ad Spend Budgets
With larger Google daily spending you can gather data to start making better decisions very quickly. I highly recommend having many ad groups that have very clear user intentions and specific keywords that are all very aligned to ensure an easy optimization process.
Let’s go through a practical example
People tend to type out very specific keywords on google. So we want our ad campaigns to be tailored to users’ very specific needs! Here are 3 example ad groups below we will use for our example.
We have 3 ad groups (which are the needs of the searcher):
- Roof Repair
- Roof Contractor
- Roof Replacement
| Adgroup: Roof repair | Adgroup: Roof contractor | Adgroup: Roof Replacement |
| KW: roofing repair | KW: roofing contractor | KW: roof replacement company |
| KW: local roofing repair | KW: roofing contractor near me | KW: affordable roof replacement |
Each ad group contains keywords that fall very specifically in line with the need of the user. I never want to mix up someone who wants light repairs with someone who wants replacement!
Repairs likely earn less revenue than a full replacement. We may be willing to spend $50 per repair lead, but $200 per replacement lead as the profit margins are very different.
How does this impact large budgets?
Imagine you have the capability to create 5-12 ad groups. This means 5-12 very specific sets of ads and keywords that relate to the insanely specific needs of your consumer. When a google ads manager gets this intentional, this specific and this detailed, it becomes MUCH easier to optimize.
Kill the failing ad groups and keep running the winners!
If you are detailed upfront when building your campaigns, you can quickly and easily see which ad groups and keywords are creating high-quality leads and giving your brand success.
This leads to faster optimization turnaround times (lowering cost per lead as fast as possible), and ultimately a better user experience for the person searching!
Keyword -> Ad -> Landing Page Relevancy
As Google ads campaign manager, it is important to slow down, take time to look at the keyword, think of the need of the user, reflect that in the ad, and make sure your landing page is specifically targeted for that need.
The Right Google Ads Budget
Starting with a budget that is low can yield no results, starting with too much spending can put a business behind on cash flows and savings. I have found the sweet spot is right in the middle.
Set the right budget to achieve results in a timely manner so that you can begin creating better outcomes and making good optimization decisions.
A great Google Ads marketing manager will set clear expectations as to what you can expect, and will be capable to express why ads are doing well, and why they may be underperforming.
We would love the opportunity to help audit your account, address any questions you have, and craft a strategy that creates success for your business! Reach out below and let us know if we can help in any way.