How Much Does Google Adwords Cost for a Small Business in 2018?

The question is asked all the time “How much do I need to spend on Google AdWords to make it worthwhile?”.

The answer to how much does Google AdWords cost isn’t a black and white one unfortunately because the advertising platform is so flexible, to begin with.

The short answer is:

How Much Does Google AdWords Cost?

Be prepared to spend a minimum of $500-$600 per month, and if you can afford more then the results you achieve will come faster.

The long answer is what we’ll cover next.

Variables that Affect Your Google AdWords Cost

The main factors that affect how much you need to spend on Google AdWords are:

What keywords you want to advertise on
The competition in your industry to advertise on those words
Your city (bigger cities are generally more expensive because of more competition)

In industries where a customer has an extremely high lifetime value the cost per each click you get on your ads in Google Adwords is higher.

Also, if there are a lot of other businesses that also want to advertise on those same keywords, then the cost is going to be higher thanks to good ol’ supply and demand.

For most local small business markets we see costs per click in the range of $3 to $8 per click. In some hyper-competitive markets such as mortgages and insurance, we see the cost per click ranges going into the $12 to $15, but rarely higher than that for local based service industries.

How to Determine Your Google AdWords Budget?

When deciding how much you need to spend on Google Adwords, the first step is determining how much you can afford to spend.

I mentioned it at the beginning of this article, but you should be prepared to invest $500-$600 minimum in Google Adwords to make it a worthwhile test.

In some industries and cities, however, that may not be enough. So how can you estimate your budget amount?

The video below will walk you through the basics of budget estimation for Google Adwords.

The basics of determining your budget are:

How many potential searches are there each month for the keywords you want to advertise on (you can figure this out using tools like SEMRush and Google Keyword Planner)
What are the suggested costs per click for those keywords?
Take a healthy 5-10% of the total number of searches and then multiply that by the average cost per click cost to get your budget amount.

Here’s an example.

Say there are a possibly 3000 searches a month for the keywords you feel would be best to advertise on in your Google AdWords campaign.

10% of 3000 = 300 clicks.

Now let’s say the estimated average cost per click is around $4.50.

300 clicks x $4.50 = $1,350

A suggested budget in this scenario would be $1,35 a month, or how we set this up inside your Google AdWords account is dividing that total monthly budget by 30 days to get a daily amount (Which would be $45 a day).

Hopefully that example shows how to determine what you need to spend in Google Adwords to run a successful campaign.

The cost of Google Adwords for a small business isn’t fixed, and you can set that daily budget to just about any number you want. Keep in mind, the lower your budget, the fewer clicks you get and the longer it takes to potentiall see results.

Want to see how we do our research for other local businesses and build out a successful Google AdWords campaign? Click here to grab our free demo video and price guide.

We walk you through everything from our research into what potenital exists in your market and city to determine how much we should bid for your keywords.

Click here to grab it now.

Ian Henman

Ian is the Digital Marketing Strategist with Footpath Marketing, helping local businesses decide what online advertising platform is right for them and planning out campaigns. He's a self-proclaimed "all things marketing" geek and has been known to talk WAAAYYYY too fast when he gets excited about things!