Back To Listings

Maximising Your Google Ads Budget: A Guide for Smart Digital Marketing

Digital Marketing

Managing your budget effectively is crucial for achieving successful results in your Google Ads campaigns. In this informative guide, we'll cover essential aspects of budgeting, including daily and monthly budgets, setting the right budget for different business types, knowing when to increase your budget, and optimising your spending for maximum impact.

Daily Budget and Monthly Budget Allocation:

Your daily budget represents the maximum amount you're willing to spend on Google Ads each day. Google will determine your monthly budget by multiplying your daily budget by 30.4 (the average number of days in a month). However, it's important to note that your daily spend might exceed your daily budget on certain days, but Google will not surpass your monthly budget in the long run.

Fast and frequent changes to your budget can have a negative impact on your campaign's performance. Avoid making drastic adjustments too often as it can disrupt the optimisation process. To control your monthly spending, you can also set a monthly spending cap within the billing section of your Google Ads account.

Here are some common questions I get asked regarding Google Ads budgets.

1. Recommended Budgets for Small Businesses: What should my budget be? How much should I spend on Google Ads?

For small businesses just starting with Google Ads, allocating a budget between $500 to $2000 per month is a good approach. It's not necessary to spend a lot to see positive results. However, the optimal budget varies depending on the industry and the cost-per-click (CPC) of keywords.

For example, businesses in highly competitive industries like law or plumbing may need to invest around $2000 per month initially to see tangible benefits. Conversely, e-commerce businesses with lower CPCs can get valuable insights and results with a budget as low as $500 per month.

The best way to help clients decide budget is to determine how fast they want things to go and how much risk they want to take on in order to achieve their goals. Eg $500 a month would be a steady learning curve for both us the agency and the Google ads platform. However $2000 would accelerate that learning, however the risk is higher.

2. When to Increase Your Budget: When should I increase my budget? When is the right time to increase my budget?

Increasing your budget should be based on specific indicators rather than merely spending more. Two primary factors to consider are the quality of traffic and conversion rates. If you're not getting conversions even with sufficient traffic within your existing budget, it's time to evaluate your campaign strategy before increasing spending.

Before scaling up, ensure that the increased budget aligns with your desired results and objectives. Also, remember that budget alone won't guarantee more conversions or success; it's essential to focus on conversion rates and return on investment (ROI).

3. Analyzing Competitor Spending: How much are my competitors spending?

Monitoring your competitors' spending can provide valuable insights, but it's not always an accurate measure of their performance. Instead, focus on using Google Ads' auction insights to gain a better understanding of your competition's performance and adjust your strategies accordingly.

4. Allocating Budget for E-commerce Campaigns: For ecommerce where should I put my spend?

For e-commerce businesses, a significant portion of the budget should be allocated to Shopping Ads, also known as Product Listing Ads (PLAs). These ads are generated from a product feed in your Google Merchant Center. Shopping Ads are highly effective in showcasing your products to potential customers, making them a critical element of any e-commerce advertising strategy.

5. Best Use of Your Budget: What is the best use of my budget?

To make the most of your budget, consider dividing it as follows:

  • 10% for Remarketing: Re-engage with users who have previously visited your website to increase conversions.

  • 20% for Top-of-Funnel Keywords: Targeting new opportunities and generating brand awareness.

  • 70% for New Customer Acquisition: Focusing on converting new customers to expand your business.

6. Budgeting for Brand Campaigns: How much should I spend on brand campaigns?

Investing in brand campaigns becomes essential when competitors bid on your brand name. The need for a brand campaign depends on factors like the strength of your brand and organic performance. If you must compete with competitors bidding on your brand name, creating a brand campaign can help maintain visibility and protect your brand reputation.

Effectively managing your Google Ads budget is vital for achieving success in your digital advertising campaigns. By setting the right budget, optimising spending based on performance, and utilising the right campaign types, you can maximize your ROI and reach your target audience more efficiently. Remember to regularly analyse your campaign data and adjust your budget and strategies accordingly to stay ahead in the competitive digital landscape. If you need expert guidance or assistance with your Google Ads campaigns, Zimple Digital is here to help you achieve your marketing goals.

Contact us