How Much Does Google Ads Cost in Australia

In this article, you'll learn about the average cost of Google Ads in Australia in 2024. We'll also discuss factors influencing pricing and how you should optimise your budget for maximum Return on Investment (ROI).
Managing Director Benjamin Paine at Digital Nomads HQ

Written by: Benjamin Paine

Managing Director at Digital Nomads HQ

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As you’ve landed on this article, we reckon you’re wondering what Google Ads cost in Australia and, more importantly, whether you can afford it. We’d hate to be that marketer saying this, but the best answer we can provide is that it depends

Even though there is no one-size-fits-all answer here, luckily, we do have benchmarks to pull from for industry-specific numbers. However, there are still a bunch of factors that can mean your actual spend will be higher or lower than these numbers (which we’ll cover in a sec). 

So, word to the wise, take this article as a “now I can set a realistic budget for Google Ads” rather than an “I’m going to spend $X per month.”

Google Ads: A Brief Overview

Google Ads is an online advertising platform developed by Google, it allows businesses to create ad campaign’s to promote in Google SERPs (search engine results pages) and other Google-affiliated websites.


Essentially, the Google Ads system allows you to put your message & campaign in front of potential customers that are actively searching for products or services like yours.


Investing in Google Ads can feel a little overwhelming… however the potential to reach your ideal customer at the key moment they are searching for your product or service sounds to good to be true!

But the key question still remains: “What will it cost me?”


Your Google Ads costs will vary based on factors like targeted keywords, industry competitiveness, ad quality, and campaign management within your Google Ads account.

How Does the Pay-Per-Click (PPC) Model Work?

Before we go into the details of what Google Ads costs, we’ll quickly run over how the PPC model actually works.
  1. Creating ads: You design text ads, image ads, or video ads that are relevant to your business and target audience.
  2. Defining your target keywords: These are the search terms that you want to trigger your ads. When someone searches on Google using those keywords, your ad might appear.
  3. The auction system: Google Ads runs on an auction system. You set a maximum bid (the most you’re willing to pay) for each keyword.
  4. Google Ads are ranked: Google considers your bid amount and the quality of your ad to determine its position on the page.
  5. You only pay when clicked: You don’t pay for your ad to be shown; you only pay when someone actually clicks on it and visits your website. This is why it’s called “pay-per-click.”

Factors That Impact Google Ads Costs

Industry, Consumer Trends, and Customer Lifecycle

Google Ads costs can vary depending on several factors, including industry, customer lifecycle (the stages a customer goes through when interacting with a business, from awareness to conversion), current trends, and account management (who manages your account).

The industry and customer lifecycle are two significant factors that impact Google Ads costs. Different industries have varying levels of competition, which can drive up the cost of ad clicks.

For example, the finance and insurance industries tend to have higher costs per click (CPC) due to high competition; however, the customer lifecycle also impacts Google Ads costs, as businesses need to stay top-of-mind throughout the customer’s journey.

Businesses need to create ad campaigns that target each stage of the customer lifecycle to maximise their ad spend.

For example, a business may create a campaign to target customers in the awareness stage, another campaign to target customers in the consideration stage, and another campaign to target customers in the conversion stage.

How Much Do Google Ads Cost In Australia? 

In 2024, the average cost per click for Google Ads ranges from $2 to $5 AUD, but it varies by industry.

Google Ads management cost can vary based on the agency fee structures, such as fixed monthly rates or percentages of spend.

E-commerce can be as low as $1.76 yet yields a lower conversion rate.

On average businesses spend $1,000 – $20,000 monthly, which are adjustable through daily budgets in Google Ads campaigns. Monthly Google Ads budgets can vary significantly based on industry, competition for keywords, and campaign objectives, with smaller businesses typically starting at lower budgets while larger companies in competitive sectors may spend more.

Additional costs include management fees, averaging $800 to $2,000 monthly, depending on campaign needs and whether the manager is a freelancer or a dedicated digital marketing agency.


Average Monthly Google Ad Budgets


Small to Mid-Size Businesses

Typical Range: $1,500 – $15,000 AUD per month

Lower End: This is generally small businesses & start-ups with limited budgets, focusing on local targeting or niche markets.

Higher End: This is generally businesses with broader reach, more competitive industries, or aggressive growth goals.

 

Larger Businesses

Typical Range: $20,000 – $50,000+ AUD per month

These businesses often have multiple campaigns, broader targeting, and higher spending to maintain/obtain market share and be competitive in their industry.

Average Cost Per Click in Google Ads by Industry

Average Cost Per Click (CPC)

Industry Average CPC (Search) Average CPC (Display Network) Average CPC *AUD Average CPC (Display Network) *AUD
Advocacy $1.43 $0.62 $2.17 $0.94
Automotive $2.46 $0.58 $3.74 $0.88
B2B $3.33 $0.79 $5.06 $1.20
Consumer Services $6.40 $0.81 $9.73 $1.23
Dating & Personals $2.78 $1.49 $4.23 $2.26
E-Commerce $1.16 $0.45 $1.76 $0.68
Education $2.40 $0.47 $3.65 $0.71
Employment Services $2.04 $0.78 $3.10 $1.19
Finance & Insurance $3.44 $0.86 $5.23 $1.31
Health & Medical $2.62 $0.63 $3.98 $0.96
Home Goods $2.94 $0.60 $4.47 $0.91
Industrial Services $2.56 $0.54 $3.89 $0.82
Legal $6.75 $0.72 $10.26 $1.09
Real Estate $2.37 $0.75 $3.60 $1.14
Technology $3.80 $0.51 $5.78 $0.78
Travel & Hospitality $1.53 $0.44 $2.33 $0.67

Industry

Average CTR (Search)

Average CTR (Display Network)

Advocacy

4.41%

0.59%

Automotive

4.00%

0.60%

B2B

2.41%

0.46%

Consumer Services

2.41%

0.51%

Dating & Personals

6.05%

0.72%

E-Commerce

2.69%

0.51%

Education

3.78%

0.53%

Employment Services

2.42%

0.59%

Finance & Insurance

2.91%

0.52%

Health & Medical

3.27%

0.59%

Home Goods

2.44%

0.49%

Industrial Services

2.61%

0.50%

Legal

2.93%

0.59%

Real Estate

3.71%

1.08%

Technology

2.09%

0.39%

Travel & Hospitality

4.68%

0.47%

Average Cost Per Action CPA (or Cost per conversion)

Cost per action (CPA), also known as cost per conversion, is a key metric in Google Ads that tells you how much you’re spending to achieve a specific customer action, such as a purchase, sign-up, or form submission. 

It’s a key indicator of your return on investment (ROI) because it directly links your ad spend to tangible results. 

Google Ads spend is influenced by various factors including industry specifics, competition, and advertising goals, leading to variability in expenditures across different sectors.

Calculating CPA

The formula for calculating CPA is straightforward:

CPA = Total Cost of Advertising / Number of Conversions

For example, if you spend $500 on a Google Ads campaign and get 25 conversions, your CPA is $20.

You can use our Cost per conversion calculator to make things easier for you here

Average Cost Per Action (CPA) By Industry

Industry

**Average CPA (Search)

**Average CPA (Display Network)

Average CPA (Search) AUD

Average CPA (Display Network) AUD

Advocacy

$96.55

$70.69

$146.76

$107.45

Automotive

$33.52

$23.68

$50.95

$35.99

B2B

$116.13

$130.36

$176.52

$198.15

Consumer Services

$90.70

$60.48

$137.86

$91.93

Dating & Personals

$76.76

$60.23

$116.68

$91.55

E-Commerce

$45.27

$65.80

$68.81

$100.02

Education

$72.70

$143.36

$110.50

$217.91

Employment Services

$48.04

$59.47

$73.02

$90.39

Finance & Insurance

$81.93

$56.76

$124.53

$86.28

Health & Medical

$78.09

$72.58

$118.70

$110.32

Home Goods

$87.13

$116.17

$132.44

$176.58

Industrial Services

$79.28

$51.58

$120.51

$78.40

Legal

$86.02

$39.52

$130.75

$60.07

Real Estate

$116.61

$74.79

$177.25

$113.68

Technology

$133.52

$103.60

$202.95

$157.47

Travel & Hospitality

$44.73

$99.13

$67.99

$150.68

How Do You Find Estimated CPC Costs & Search Volumes?

Google Ads Keyword Planner : This free tool within Google Ads is a great starting point. Enter your relevant keywords and it provides estimated CPC ranges, competition levels, and search volume. Understanding how much Google Ads will cost can be complex, as it depends on various factors like bidding strategies and industry-specific variables. Using cost calculators and benchmarks can help you get tailored estimates based on your campaign goals and market conditions. Pro: Directly from Google, good for initial estimates. Con: Can be broad, accuracy depends on your campaign settings. Auction Insights (Google Ads): If you’re already running Google Ads campaigns, use the “Auction Insights” feature. This shows how your performance compares to competitors for specific keywords, including impression share, overlap rate, and position above rate. Pro: Real-world data from your campaigns. Con: Only available after you’ve started running ads. SEMrush, Ahrefs, Moz: These SEO/SEM tools offer more in-depth keyword data, including CPC estimates, keyword difficulty scores, and competitor analysis. Pro: More data points, competitive insights. Con: Subscription-based, may require some learning curve.

EXPERT TIP: Don’t focus solely on CPC. Consider other metrics like conversion rate and ROI to evaluate overall campaign effectiveness.

How Does Google Ads Determine Your Cost per Click?

Many people mistakenly believe that in Google Ads, you automatically pay your maximum bid each time someone clicks on your ad.

However, this isn’t the case; campaigns can often be far more budget-friendly!

Here’s an overview of how Google Ads calculates your cost-per-click (CPC):

1. The Auction:

Every time someone searches on Google, an auction is triggered if advertisers bid on keywords relevant to that broad search term.

Your ad enters the auction alongside other ads targeting the same keywords.

Infographic - displaying how AD quality score impacts the cost of ads
2. Quality Score: Google assigns each ad a Quality Score (ranging from 1 to 10). This score reflects: Ad relevance: How closely your ad matches the search query. Expected click-through rate (CTR): How likely your ad is to be clicked. Landing page experience: The quality and relevance of your landing page. 3. Ad Rank: Google calculates your Ad Rank using the following formula: Ad Rank = Quality Score x Maximum Bid Your maximum bid is the highest amount you’re willing to pay for a click. Ads with higher Ad Ranks get better positions on the search results page. 4. Actual CPC: You only pay when someone clicks your ad, and the actual CPC you pay is often less than your maximum bid. Here’s the formula Google uses: Actual CPC = (Ad Rank of the ad below you / Your Quality Score) + $0.01   So what does this mean for you? Higher Quality Score = Lower Costs: Achieving a higher Quality Score can lead to lower CPCs and better ad positions, even if your maximum bid is lower than a competitor’s… it’s like receiving a discount. You’re not always paying the maximum bid: The auction system and Quality Score help ensure you’re paying a “fair price” for clicks. Small businesses can compete: By focusing on high-quality ads and landing pages, you can compete with larger advertisers, even with smaller budgets.

Managing Your Google Ads Budget

Setting a realistic Google Ads budget is like finding the sweet spot between ambition and affordability. 

Here’s how to strike that balance: 

1. Define Crystal-Clear Campaign Goals:

What are you hoping to achieve with Google Ads? Increased brand awareness? More website traffic? Lead generation? Online sales? Each objective has different cost implications.

Set specific, measurable targets. For example, “Generate 50 qualified leads per month” or “Achieve a 2% conversion rate on sales.”

2. Know Your Keywords (and Their Costs):

Use Google’s Keyword Planner. As mentioned above, This free tool helps you research relevant keywords and calculate their estimated cost-per-click (CPC) for your Google ads campaigns. 

Do your research, by understanding your keywords and their search intent; while some keywords may be expensive, they may lead to higher-quality leads and better results.

Factor in competition. Highly competitive keywords (like “insurance” or “loans”) will generally have higher CPCs. Competition isn’t just keyword-specific, but consider geographic locations, higher density areas, and competitive industries all factor into a “knock on” effect to CPC costs.

Consider long-tail keywords. These are longer, more specific phrases (like “best car insurance for young drivers”) that often have lower competition and advertising costs – where as broad keywords (more popular keywords) tend to have higher costs… but not always better conversion rates.

3. Align with Your Overall Marketing Budget:

Look at the “big picture”. How much are you spending on your digital marketing overall? What percentage can be allocated to Google Ads?

Start conservatively. It’s better to begin with a smaller budget, monitor results, and gradually increase spending as you optimize your campaigns as the campaigns start obtaining data (this being conversions).

4. Factor in Your Sales Cycle and Customer Value:

Consider your average customer lifetime value (CLV). If you’re selling high-value products or services, you may be able to afford a higher cost-per-acquisition (CPA).

Why’s this important?

Review your campaign performance regularly, campaigns can often provide negative ROI when measuring first conversion against the sale and first interaction. 

However, when you consider a customer’s repeat rate or CLV (customer lifetime value), this can exponentially increase the return on the campaign.

Think about your sales cycle length. If it takes time to convert leads into customers, factor that into your budget planning.

5. Don’t Forget Ongoing Optimization:

Budgeting is an ongoing process. Review your campaign performance regularly campaign performance and adjust your budget based on what’s working and what’s not.

Consider professional help. If you’re new to Google Ads or have limited time, hiring a Google Ads specialist or agency can help you optimise your budget and get the best results.

Tips to Optimise Your Google Ads Campaigns

1. Keyword Optimization

Refine Keyword Match Types: Use a combination of broad, phrase, and exact match types to balance reach and relevance.

Negative Keyword List: Exclude irrelevant searches to improve campaign targeting and reduce wasted spend.

Focus on Long-Tail Keywords: Target more specific, lower-competition keywords to improve quality score and conversion rates.

Regularly Review Search Terms: Analyse the actual search queries that trigger your ads and identify new keyword opportunities or areas for negative keyword additions.

Leveraging Google Ads Reports can help track performance and identify trends, providing valuable insights for optimisation.

2. Ad Copy & Quality Score

Write Compelling Ad Copy: Highlight unique selling points, include strong calls to action, and tailor your message to your target audience.

Use Ad Extensions: Add sitelinks, callouts, and other extensions to provide more information and improve ad visibility.

A/B Test Ad Variations: Experiment with different headlines, descriptions, and calls to action to identify the most effective combinations.

Improve Landing Page Relevance: Ensure your landing pages align with your ad copy and provide a seamless user experience.

3. Bidding & Budget Management

Choose the Right Bidding Strategy: Select a bidding strategy (manual, automated) that aligns with your campaign goals and risk tolerance.

Monitor and Adjust Bids: Regularly review your bids to ensure you’re competitive while staying within your budget.

Set Daily/Monthly Budgets: Allocate your budget strategically across campaigns and ad groups.

Utilise Bid Adjustments: Adjust bids based on device, location, time of day, and other factors to optimize performance.

4. Targeting & Audience Refinement

Refine Location Targeting: Target specific geographic areas to reach the most relevant audience.

Utilise Demographic & Interest Targeting: Reach users based on their demographics, interests, and online behaviour.

Implement Remarketing: Target users who have previously interacted with your website or ads.

Experiment with Audience Segmentation: Create separate ad groups for different audience segments to tailor your messaging.

5. Tracking & Measurement

Set Up Conversion Tracking: Track the actions users take after clicking your ads (e.g., purchases, sign-ups).

Analyse Campaign Performance: Regularly review key metrics like click-through rate (CTR), conversion rate, and cost-per-conversion.

Use Google Analytics: Gain deeper insights into user behaviour on your website and identify areas for improvement.

Leverage Google Ads Reporting Tools: Use the reporting features within Google Ads to track performance and identify trends.

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