Google Ads are everywhere. Every year, millions of businesses around the world spend trillions off their budgets on Google Ads. From corporates to non-profits, Google Ads have become the gateway to boost brand awareness strategies, high traffic, and conversions. 

If you’re new and looking to get into Google Ads, you’re on the right path- but are the costs making you hesitate?

Don’t worry, we’ve got you. 

As a Google Partner accredited Agency, staffing a team of highly qualified Google Ads specialists, our PPC experts will give you an answer that won’t leave you hanging. This blog will take you through everything you need to know about Google Ads costs in Australia. 

So…

How Much Do Google Ads Cost In Australia? 

To give you a quick ballpark figure, the average cost per click (CPC) in 2025 is between $2-4 AUD. But when industry and other dependant factors come in, this cost can vary. Say, if you’re bidding on keywords for legal, your CPC will be $10.61, insurance keywords start at $13.37, and e-commerce keywords will be somewhere around $1.82. 

For a monthly figure, advertisers usually spend anywhere from $1000 to $20,000 per month on Google Ads. But once again, this can change based on advertising requirements and the assigned marketing budget.  Now, this monthly figure can further be broken down into your daily ads budget, which will be managed by the Google Ads campaign. From your Google Ads account, you can access the Google Ads billing system and obtain important information such as billing details, promotions, and credits. 

Apart from the actual advertising costs for Google Ads, if you plan to hire a Google Ads manager for your ad campaigns, the management fee will sit somewhere between $800 and $2000, based on your campaign needs and whether you’re opting for a freelancer or a digital agency specialised in Google Ads. 

Industry-Specific CPC Breakdown

Google Ads cost changes based on the type of industry, competition, and keyword demand. This table will show you the estimated cost per click (CPC) by industry in Australia:

Source: Google Ads Benchmark Reports 2025

What Factors Influence Google Ads Costs?

1. Consumer Demand

The level of demand your business has affects the cost of Google Ads. Let’s say you’re running a service-based business with a strong and frequent demand (e.g., hairdressing service). For this type of business, people will be actively searching for keywords related to your business. This can make your industry more competitive, but it can also make it easier for your ads to be targeted. Frequent searches by customers mean you can pick relevant keywords with a strong search volume to help drive more clicks and conversions.

When you run your Google Ads campaigns, even with a minimal daily budget, you will still receive a fair number of clicks and leads. And the more customers that convert from your Google Ads, the less your average cost per conversion (cost per lead) will be, making it cost-effective to run your Google Ads.

But this may take a turn if you’re selling a niche product or service. If this is the case, your product is unlikely to be heard by a mass audience, therefore lowering your demand and increasing your ad costs. However, this doesn’t mean new/niche businesses shouldn’t run Google Ads.

2. Keywords & Targeting

Keyword Relevance and Search Volume – Keywords that are in demand or are highly competitive are more expensive.

Keywords tell you which customers you should target within Google Ads. Think of keywords as a navigator that directs your customers to your site and products—the right keywords get them exactly where you want them to go, and vague ones drive them away from your site. Popular keywords with stronger search volumes tend to cost more due to high competitiveness, but more specific, long-tail keywords tend to cost less per click.

• Keyword Intent:

Your keyword search intent also matters in costing. Keywords with navigational intent (e.g., someone searching directly for “Bunnings Online”) or commercial intent (searching for “Buy cheap dining table”) generally help drive quick conversions or sales due to stronger intent and, therefore, are more desirable for marketers to target. This competitive nature often makes the keywords more expensive to target. However, keywords with an informational intent (e.g., “How do air conditioners work?”) reflect someone’s search for information about a product or service that they aren’t ready to purchase yet in that stage.

• Keyword Planner:

The Keyword Planner tool in your Google Ads account is one of the best tools out there to better understand your pay-per-click (PPC) costs. All you need to do is enter the keywords you aim to target, and the tool will display the relevant keywords’ search volumes and average cost per click.

Industries with high demand, such as legal and finance, tend to have a higher CPC.

As we mentioned earlier, the type of industry matters for your ad costs. Typically, the higher the competition in an industry, the higher your ad costs will be. On the other hand, less competition means lower ad costs due to the low number of bidders bidding on keywords.

FYI, these are some of the industries with the highest CPC within Google Ads :

•   Insurance
•   Marketing and Advertising
•   Automobile dealership
•   Legal
•   Dental services

Panicking that your business is in one of the above industries? Fret not. Because though your industry is in the highly competitive zone, there are ways to retain your Google Ads budget and return on ad spend (ROAS) within budget. You can do this by setting down a target cost per action (CPA) that matches the amount you’re willing to pay for a lead while ensuring your daily budget has a limit. On the other hand, if your industry has low competition but still has good demand, then you can pay a lower CPC for your ads while still driving better results.

4. Quality Score

Ad Rank and Quality Score – When you score a better ad rank with high quality, your CPC drops.

Quality score is how Google rates the relevance and quality of your keywords and PPC ads. This score determines your CPC and your ad rank in the auction process. Having a great quality score is a major win, as Google Ads with a high quality score cost less than ads with a lower quality score.

3 key factors determine your quality score:

•       Expected CTR : the likelihood of your ad being clicked
•       Ad relevance : how relevant your ad copy and creative is to the customer’s search intent
•       Landing page experience : how useful and relevant your landing page is to your customers.

You can view your quality score from your Google Ads account, sometimes within a new “column”.

5. Bidding Strategy

The type of bidding you’re choosing (manual or automated) impacts your ad costs. In 2025, Google Ads continue refine following bidding strategies with AI-driven approaches to optimise advertising performance and quality.

• Smart Bidding

  • Smart bidding is an automated bidding strategy that enhance conversions and conversion value by leveraging Google’s machine learning algorithm. This includes Key strategies like: Target CPA (Cost Per Acquisition), Target ROAS (Return On Ad Spend), Maximise Conversions, Maximise Conversion Value.

• Manual CPC (Cost Per Click)

  • With this option, you choose how much to pay for each click on your ad. It gives you full control over your bids, but you need to keep an eye on it and adjust it regularly since it doesn’t change automatically based on market trends.

• Enhanced CPC (ECPC)

  • This is a mix of manual bidding and automation. Google helps adjust your bids in real-time to get more conversions while still keeping some control in your hands. However, from March 15, 2025, Google will move all ECPC campaigns to Manual CPC.

• Maximize Clicks

  • This strategy helps you get as many clicks as possible within your budget. It’s a good option if your main goal is to bring more visitors to your website.

• Target Impression Share

  • If you want your ads to appear in a specific position on Google search results, this strategy helps you do that. You set a target for how often your ad should appear, and Google adjusts your bids to meet that goal.

• Target CPM (Cost Per Thousand Impressions)

  • This is mostly used for video ads. Instead of paying per click, you pay for every 1,000 times your ad is shown. It’s a great choice if you want to increase brand awareness rather than focus on clicks.

6. Geographic Targeting

 Location affects, so ads from major metro areas (Sydney, Melbourne) come with bigger price tags compared other regional areas due to the level of Ad competition.

7. Customer Lifecycle

Your customers may be in a short customer lifecycle if they’re looking to purchase a service or product after they’ve seen your ad once or maybe twice. A longer customer lifecycle means customers are looking to spend more time on digital touch points before they make that final purchase. In longer cycles, you may need to reach out to them via multiple channels (in addition to Google, such as  Facebook, Instagram, etc.)  before getting a conversion. These activities will affect your overall ad costs.

How Do You Budget Effectively In Google Ads?

With all we shared above, it’s important to set successful strategies for your ads at a budget that works for you. For best results and a stress-free campaign, we recommend a few things you can do:

• Test Different Ad Types

Google can test different ad headlines, descriptions, and creatives and perform from one ad type to another to see which ad combinations convert best. Testing also helps you understand what type of ad content is preferred by your target audience. By running tests over time, you can use this data to create successful campaigns and pick your best-performing ads to raise your conversions at a lower cost. 

• Bid On Keywords With Less Competition

Now you know that highly competitive keywords are what every advertiser wants. But while it may be right to target these competitive keywords, you can also find positives in targeting less competitive ones. The magic behind low competitive keywords with medium to lower search volume is that they allow you to target specific, long-tail keywords that are highly relevant to your audience but are less likely to be targeted by your competitors. For example, if you’re selling custom tailored men’s suits, rather than targeting “men’s suits” alongside every other men’s suit advertiser, try targeting “men’s tailored suits” or “made-to-measure suits.” This way, if a user searches for “tailored men’s suits,” your ad copy will be far more relevant to the searchers, and therefore more likely for the user to convert when they see your ad. In addition, this keyword has less competition in bidding due to the low search volume, therefore, it’ll be cheaper to target, driving your overall CPC down.

• Target Effectively

Precise targeting can bring down your Google Ads costs. In your Google Ads settings, be sure to adjust the correct demographics (age, gender, and location) of how you want your Google Ads to appear. Good and correct targeting will save you the risk of irrelevant impressions and ad clicks from users who aren’t likely to convert. As a result, you’ll be using your Google Ads budget effectively by only targeting customers in your ideal target market with a high chance of conversion.

• Optimise Quality Score

Having a great quality score will spike up your ad rankings, which means you get more clicks and conversions. So, boosting your Ad quality for a positive quality score is important and contributes to the reduction of your overall ad costs. You can optimise your quality score by choosing the right keywords for your users’ intent, compiling ad copy to reinforce your keywords, improving your Google Ad’s landing page for high relevancy and engagement, and finally, optimising keywords to promote high click-through rates (CTR).

There are many ways to optimise your ads for better ranking and reduce your bill, but the above tips will create a direct path for you to achieve your Google Ads goals while staying under budget.

 The Best Cost-Effective Google Ad Types

If you are looking for running Google Ads with a limited budget, choosing the right ad type is crucial. Let’s find out the most budget friendly  Ad options:

• Search Ads –  These Ads show up on Google search results when people search something related to your business, and they work well because these ads appear when someone already looking for something your business offer.

• Display Ads – These visual ads such as pictures or banners that show up on different websites partnered with Google. These ads are much cheaper than search Ads and are great option for brand promotions because people notice your brand.

• Performance Max Ads – This Ad type run across Google’s all digital platforms, including Search, YouTube, and Display. This Ad type use Google’s automated adjustments of your ads to get the best results for your limited budget.

• YouTube Ads (Skippable Video Ads) –  You might have seen these ad types when you play Youtube videos that play before or during YouTube videos. You’ll be charged if someone watches a certain amount of the ad, so if the ad is skipped quickly, you don’t get charged.

• Shopping Ads – If you are an ecommerce business and sell products online, Shopping ads is great option. These ads show up with visuals of product picture, Product price, and store name at the top of Google or sometimes under the shopping tab. This ad type can bring in more sales online with a limited budget spending.

• Re-marketing Ads – If you want your past customers or website visitors to return, this is the ad type you should try because these ads target people who have already visited your website or online store. Since these audience has already shown interest, they are more likely to buy or engage with your business, which makes these re-marketing ads a cheaper option to get more engaged customers.

How to Improve Google Ads ROI with Reduced Ads Cost

• Use Negative Keywords

  – Negative keywords, also known as irrelevant keywords, lower your ad cost by preventing your ads from showing up for irrelevant searches.  

• Optimise Landing Pages

  – with good SEO strategies, you can enhance your landing page for better navigation, content, conversion rates, and lower CPC too.

• A/B Test Ad Copy

  – Testing different versions of your Google Ads allows you to identify high-performing ads and content that your target audience prefers.

• Adjust Bidding Strategies

  – Make use of smart bidding strategies to optimise your bids for efficiency.

• Target Specific Locations

  – Instead of targeting generic locations, try targeting specific locations to reduce your ad costs.

Choosing the Right Google Ads Budget

If you’re feeling burnt out from figuring out a Google Ads budget, let us help. The first thing you need to know is that your budget depends on certain factors, such as industry, campaign goals, and audience size. For a small business, we recommend starting with a budget of $500 -$2000 per month, with adjustments based on performance.

Budgeting Strategy :

• Low competition niches – $10 – $20 per day
• High competition niches – $50 – $100 per day
• Test and scale – start small, then analyse those results, and slowly build your budget over time.  

Final Thoughts: Is Google Ads Worth It?

Yes, if you strategise and optimise your Google Ads effectively, they can be profitable. The point is to understand your ad costs in depth, spruce up your bidding strategies, and improve ad quality. Do that right, and you can maximise your ROI and run your ads under budget.

Thinking of introducing your business to Google Ads but don’t know where to start? If this blog sparked your interest and you think you need assistance, our Google Ads specialists at Digital8 are a call away! 

We want your business to thrive as much as you do, so while you focus on more important things, let us work on driving more conversions.

If you read this blog and are considering launching Google Ads or are interested in getting some support to help optimise your ads account, our Google Ads specialists at Digital8 are just a phone call away!

We are passionate about getting your business seen and heard by your target market and driving real results. So, what are you waiting for! Get back to doing what you do best and let us take care of your Google Ads Management.