Advertising on Google is one of the best decisions you can make to expand your reach, find new customers, and grow your business. Google Ads (formerly known as Google AdWords) is the world’s largest and most widely used online advertising platform. By advertising on Google, your business can reach a potential audience of millions.

In this article, we will break down how to advertise your small business on Google, including:

  • How Google advertising works
  • Cost of Google ads
  • What is a click-through rate?
  • What is conversion rate?
  • The return on investment (ROI) you can expect from Google ads

How Google advertising works

Google Ads are a form of search engine marketing and part of Google’s pay-per-click (PPC) advertising platform, where businesses create, launch, and manage ads through its self-service ads manager. 

Text-only ads are created by businesses, which are then displayed in search results based on a number of factors, including relevant keywords and ad content, device types, time of day, and user location. Advertisers only pay when users click on their ads.

Learn about other ways to advertise your local small business here.

Start by creating a Google Ads Manager account

After that, click the “+” sign on the Ads Manager homepage to launch the new campaign creation process. Here, you will be prompted to complete all necessary ad creation steps, from inputting your daily budget to picking a location, choosing target keywords, adjusting general ad settings, and finally, writing your Google ad.

After finishing the new campaign creation process, Google will review your ad. This generally takes around 24 hours. If your ad doesn’t violate any of Google’s advertising policies, it will be approved and go live. It will then be eligible to display in search results based on your chosen keywords and campaign settings. 

Adjust the ad

Once an ad is live, advertisers may adjust the ad to improve its performance, including changing keywords, altering the budget, or pausing the campaign.

A successful Google Ad campaign takes into account what users are searching for and what ad copy will be most compelling. If created thoughtfully and run well, a Google Ad can significantly increase conversions and sales for your business by targeting those who are ready to buy.

Cost of Google ads

Google Ads is the most in-demand advertising platform in the world. Average CPCs (Cost per Click) range from £0.48 to £1.95, depending on the channel. Let’s look at how much Google Ads cost across different industries and how these ads compare to other platforms.

According to data from WordStream, the average Google Ads CPC is £1.95 on the Search Network. The same data shows that the average CPCs on the display network is £0.48 while the average for Google Shopping campaigns is £0.54.

The average cost per click for:

  • Google Ads Search Network: £1.95 
  • Google Ads Display Network: £0.48
  • Google Shopping: £0.54
  • Microsoft Ads (previously Bing Ads): £1.25

This compares to average CPCs of £1.25 on Microsoft Ads, which generally works out cheaper for the same keyword, plus Bing traffic tends to result in higher conversion rates.

What is a click-through rate?

A click-through rate (CTR) is the number of people who clicked your ad divided by the total number of people who saw it. For example, if your Google ad got 1,000 impressions and 100 clicks, you’d have an (excellent) CTR of 10%.

Every ad you’re running and every keyword you’re bidding on has its own CTR that you need to consider.

Your Google Ad’s CTR is how you monitor whether or not the keywords you found in research are bringing in results and likely to drive a profit.

A less-than-stellar CTR hurts your wallet in more ways than one. If your ad isn’t getting clicks, that shows Google that your product or service isn’t what the users want. So a poor CTR rate can hurt your ad rank.

While a “good CTR” will change by industry and keyword, a fair benchmark is 2.88%. If your CTR is below 2.88%, it’s time to dive into improving your ad optimisation strategies.

What is conversion rate?

A conversion rate (CVR) is how many customers completed your desired action on your site divided by the number of customers who visited it.

For example, let’s say your Google Search Ad had 100,000 impressions with a CTR of 5%. That means 5,000 customers went to your landing page ( find out how to create a business website here).

If the goal of your landing page was to get a customer to schedule a free consultation, then the conversion rate of your landing page is how many customers signed up for a free consultation divided by 5,000. So, if 100 customers signed up, you’d have a conversion rate of 2%.

But how do you track that? How do you know which Google ad sent those customers to your landing page?

When you set up an ad campaign in your Google ads account, you can configure Google ad conversion tracking to specify which action you want to track.

The return on investment you can expect from Google ads

Before you get too caught up in how much you’re paying for individual clicks, consider how much you’re getting in return. 

What kind of ROI can you expect to get from advertising on Google Ads?

According to Google itself, the data across global accounts shows that for every $1 a business spends on Google Ads, they generate an average of $8 in profit.

Learn more about what is a reasonable advertising budget for small businesses here.

Gain control over your finances with a simple app

Financial management can be stressful and time-consuming when you’re self-employed. That’s why thousands of business owners use the Countingup app to make their financial admin easier. 

Countingup is the business current account with built-in accounting software that allows you to manage all your financial data in one place. With features like automatic expense categorisation, invoicing on the go, receipt capture tools, tax estimates, and cash flow insights, you can confidently keep on top of your business finances wherever you are. 

You can also share your bookkeeping with your accountant instantly without worrying about duplication errors, data lags or inaccuracies. Seamless, simple, and straightforward! 

Find out more here.