How Much Do Google Ads Cost in 2025?

Last Updated on: 5th July 2025, 02:19 pm

Advertising costs don’t stay the same on advertising platforms and Google is certainly not an exception to this. Google first launched AdWords back in 2000 and clicks were $0.01, they have since increased 100x +. So does that mean that Google Ads is too expensive to get profitable now? Not at all. The platform is more sophisticated now and utilizes AI to help optimize your ads. It’s difficult to find a lead generation method more effective than Google Ads.

Today I’ll show you everything you need to know about the costs of using Google Ads for your business. You’ll learn the average Cost Per Click, expectations for costs across different industries, and the key factors that influence your costs. Lets jump into it.

How Much Do Google Ads Cost on Average?

The cost of Google AdWords is defined by the CPC (Cost per Click) – the price you pay for each click on your ad.

So, how much are Google AdWords?

The average CPC on Google Ads in 2025 is between $1 and $2.

How Much Do Google AdWords Cost Based on Industry?

Finance and Insurance: CPCs can exceed $10-$15 and even reach $40 or more for competitive keywords.
Legal Services: Legal keywords can be expensive, with CPCs ranging from $5 to $30 or more.
Healthcare and Medical: Google Ads for doctors, Google Ads for weight loss specialists, and health and dental-related keywords can have CPCs ranging from $2 to $10 or more.
Real Estate: CPCs for real estate keywords can range from $1 to $10 or higher, depending on the location and property type.
Technology: CPCs for technology-related keywords vary, ranging from $1 to $10 or more, depending on the niche.
Retail and eCommerce: Costs depend on the products you’re advertising, with CPCs ranging from a few cents to $5 or more.
Travel and Hospitality: Travel-related keywords can vary based on destinations and services, with CPCs ranging from a few cents to $5 or more.

When you look at the figures above, it becomes pretty clear that everyone is using the strategy I often advise: starting with your Customer Acquisition Cost (CAC) and reverse-engineering from there.

For example, it’s not a problem for a realtor to pay $10 for a click and $100 to acquire a customer if they can earn $5000 from a single prospect.

On the other hand, if you’re in industries with lower profit margins, it doesn’t make sense to pay more than a few cents to acquire a customer.

However, you can lower your Google AdWords CPC if you understand the two key factors influencing it.

Key Factors that Affect Your Google Ads Cost

Google uses two main factors to define the cost of your campaigns:

Your competition & industry
Your ad quality

1. The Key Factor Determining Your Google Ads Cost: Your Industry and Competition

Suppose you’re a locksmith in Bristol, targeting a broad keyword like “locksmiths U.K.”

Your search engine results page will be full of ads from your competitors:

Example of a highly competitive Google Ads keyword

(P.S. This isn’t something I’d recommend as an experienced Google Ads coach because it’s too broad and doesn’t allow you to target highly-qualified leads.)

Since Google AdWords work like an auction, the advertiser with the highest bid and the best ad wins.

Your cost will be higher if you want your ad in the top three spots for a keyword with fierce competition.

Some industries get higher profits from each client.

For example, law firms advertising themselves can earn upwards of $1,000 for each customer acquisition. It makes sense for them to adjust their bidding to pay $50 or even $100 for each click.

On the other hand, restaurants don’t see high revenue from each converted lead, so the CPC is lower.

You can’t help the industry you’re in. But there is a factor you can influence:

2. How Ad Quality Reduces (or Increases) Your Google AdWords Costs

Google Ads want to display the best possible results based on the searchers’ search terms.

If a searcher looks up “24/7 Bristol locksmith,” they don’t want to see ads for a locksmith in Brighton.

Naturally, if Google sees two ads: one for Bristol and one for Brighton, and the search term mentions Bristol, it’ll increase the Quality Score for the Bristol ad. And then, something fantastic happens:

If your Quality Score is high, your clicks are cheap.

Increase Your Ad Relevance to Lower Your Google Ads Cost

In my 15+ years of Google Ads consulting, I’ve always recommended tailoring your ads to specific keywords. If you want to increase your Quality Score to reduce your costs, your ads must be relevant to the target keywords.

For example, if you offer service in both Bristol and London, create two separate ads targeting distinctive keywords. Then, create amazing Google Ads copy that anticipates searchers’ needs.

Example of a Google ad targeting a location

Ad relevance increases your Quality Score and influences the number of clicks (CTR or click-through rate) you get on your ads. This signals to Google that your ads correspond with the searcher’s intent.

Google takes every account in the auction and calculates the Ad Rank (Quality Score x your maximum bid). If your Ad Rank is high, your ads will be displayed at the top of the SERP.

If your ad is more relevant than your competitors’ ads, you can pay less for each click and still reach the top spot!

Impact of Quality Score on Cost Per Click image

3. Are You Running Expensive Campaign Types?

No campaign type is “expensive” on its own. However, popularity is a concern: if all advertisers are flocking to one campaign type, then it might drive the cost up through competition. Similarly, if you have a poorly-optimised campaign, that will make it very, very expensive for you.

We’ll talk about your bidding strategy in a bit, but you should also consider the stage of the funnel your campaign is perfect for. For example, Demand Gen campaigns should be used for exactly that – demand gen. Still, it means you’ll have more convincing to do to secure that conversion.

On the other hand, you can use Search campaigns to intercept people when they’re ready to make a purchasing decision.

4. Your Bidding Strategy Affects the Cost

Are you optimising for conversions, target ROAS, or simply paying for clicks within your bidding strategy?

(Pro tip: Always set up your conversion tracking and optimise for CAC, tROAS, or conversions, so you pay for real results, not just clicks. As a PPC consultant, I recommend the Target Cost Per Action bidding method (Target CPA). Once you understand your cost for each lead that converts into a customer, you can set a figure for your ad bids.)

Remember to test both manual and automated bidding methods. In the beginning, I always recommend using manual bidding so you regularly review your account’s performance and see which keywords or assets generate the best conversions, adjusting your bids accordingly.

It’s only when you know what works for your account that you can scale it with automated bidding.

5. Devices and Locations You Target

Are you targeting highly profitable audiences in well-off regions? How many of your competitors target the same people, and how do your ads compare to theirs?

It’s all about the audience available to you and your competitors. If you’re all targeting a massive pool of searchers – for example, on desktop – your CPC might be lower. However, if you’re vying for a small group of people using their mobile devices for that specific search, the costs will increase.

6. Ad Scheduling: How Does It Affect Your Google AdWords Costs?

If you’re running your ads in high-traffic times when your competitors are advertising, too, that affects your Google Ads cost. Of course, if you want them to call you on the phone and you only work from 8-4, it makes sense to target those times.

However, if you deal with any sort of emergency services, you might just profit by advertising during the night! Get creative!

Other Factors Affecting Google Ads Costs

Your other decisions will also affect your Google Ads costs:

Are you DIY-ing your ads or have a certified professional to help you? As a beginner, it’s normal to make mistakes. Unfortunately, that means increased Google Ads costs. It’s better to start off with an experienced partner right away.
Free credits promotions – Are you receiving promotions from your Google Ads Partner agency to get more budget for every pound you spend? It’s practically free money!

How Much Should I Budget for Google Ads?

There’s no minimum budget for Google Ads. However, if you’re serious about Google Ads and want to get more than a handful of clicks, start with at least $50 or $100 per day.

Your Keywords Affect How Much Google AdWords Costs

If you’re targeting broad keywords, your CPC will be higher. But you can target long-tail keywords with fewer competitors and keep your budget under control even if you’re a small advertiser.

For example, if you target “business legal advice,” you’ll have tough competition. But if you target “business legal advice helpline,” the environment shifts.

Suddenly, you have fewer competitors.

What Is Your Average Acquisition Cost?

Factor in your Cost per Acquisition when calculating your Google Ads budget.

Suppose you usually spend $100 to acquire a customer who will bring in $200 in revenue. In that case, it makes sense to adjust your budget accordingly.

Add your other acquisition channels to the budget calculations.

For example, I recently had a client who is a financial advisor with a lengthy sales cycle (20+ days) and a sales team. They’d previously paid upwards of $500 to acquire a single customer. With Google Ads, we lowered their acquisition costs to $300.

How Far Do You Want to Go with Google AdWords?

Finally, are you only using Google Ads to generate leads when there’s a lull in your business?

Are you using them to expand your market share?

Your budget primarily depends on your goals and your operational scalability. For example, if you run a plumbing business and you’re the only plumber in your business, be careful with scaling your campaigns.