As a small business owner, you know how important it is to get your business in front of the right people. With the right marketing strategy, you can reach potential customers, increase your visibility and grow your business. One of the most powerful tools at your disposal is Google Ads.
Google Ads is an online advertising platform that allows you to create and manage ads that will appear on Google search results and other websites. You can target potential customers based on their interests, location and other factors. With Google Ads, you can create ads that are tailored to your specific business goals and budget.
The key to running an effective advertising campaign, whether it's on Google, Facebook or any other channel, is to monitor your performance and keep track of key metrics. This can help you reach more leads and maximize your return on investment (ROI) by doing more of what's working and less of what's not.
But, with so many different key performance indicators (KPIs) to measure — and so many different numbers to keep track of — it's not always easy to tell if what you're doing is working, even if you're monitoring your performance regularly. To make matters more confusing, what constitutes good performance is not universal across different industries.
We're going to highlight the average performance between February 2022 and February 2023 of Google Ads campaigns run by the Ads Specialists at Marketing 360® across 20 different industries.
Average click-through rate (CTR)
CTR is a key metric for measuring the success of an ad campaign. It's the ratio of clicks to impressions for your ads. A good CTR indicates that your ad is being seen by the right people and that they're interested in what you have to offer.
As you can see, average CTRs for Marketing 360 campaigns are higher across the board. But, here are a few industries that really stand out:
- Lawyers - Marketing 360’s Google ad campaigns for lawyers saw an average CTR of 10.2% compared to 2.93%
- Spas/med spas - Marketing 360’s Google ad campaigns for spas and med spas saw an average CTR of 7.95% compared to 1.26%
- Moving companies - Marketing 360’s Google ad campaigns for movers saw an average CTR of 9% compared to 5.51%
- Roofing contractors - Marketing 360’s Google ad campaigns for movers saw an average CTR of 7.12% compared to 3.02%
How does Marketing 360® average higher CTRs for Google campaigns?
The Ad Specialists at Marketing 360® use a variety of tactics to increase CTRs. They use targeted keywords in their ad copy, create compelling ad copy, and use A/B testing to continually improve their ads. Additionally, they use advanced bidding strategies to maximize the impact of their campaigns.
All of these tactics help to ensure that their ads are being seen by the right people, they’re interested in what you have to offer and they’re enticed to click your ad.
Average cost per click (CPC)
CPC is the cost of each click on an ad. While CPC doesn't tell you much about the performance of your Google Ads campaigns, it can help you understand the overall cost of running your campaigns and how it impacts your ROI.
As you'll notice, the average CPC for Google campaigns can vary greatly by industry. For example, the average CPC for HVAC campaigns is $28.74; whereas, the average CPC for e-commerce campaigns is just $1.43.
Why does the average CPC vary so much by industry? Here are a couple of big reasons:
- Competition - More competitive industries, like HVAC and electrical, usually have higher CPCs as businesses are bidding on the same keywords and willing to pay more to get in front of potential customers.
- Value of product or service - Products and services with higher prices tend to have higher CPCs as businesses are willing to pay more to get customers to purchase their products or services.
Can you lower your CPC in a highly competitive industry?
Yes, you can! With the right strategy, you can lower your CPC even in a highly competitive industry. For example, you can reduce your CPC by focusing on long-tail keywords, which are more specific and less competitive than broader keywords. You can also use targeted ad copy and A/B testing to refine your ads and make them more effective. Additionally, you can use advanced bidding strategies to lower your CPC and maximize the impact of your campaigns.
Average conversion rate
Conversion rate is the percentage of people who take a desired action after viewing your ad. It's a key metric for measuring the success of your campaigns. A good conversion rate indicates that your ad is resonating with your target audience, and that your ad is driving the desired action.
The average conversion rate across all verticals outside of Marketing 360® is 3.75%. Here at Marketing 360, our average conversion rate is 9.30% across all verticals.
How does Marketing 360® drive higher conversion rates?
At Marketing 360®, we use a variety of tactics to increase our conversion rates. These include using targeted keywords in our ad copy, creating compelling ad copy and using A/B testing to continually improve our ads. Additionally, we direct ads to landing pages that are optimized for conversions.
Average cost per conversion
Cost per conversion is the average cost of each conversion for a particular ad campaign. Monitoring this metric is important for measuring the success of an ad campaign and understanding the overall cost of running it.
Let's look at Marketing 360® clients' average cost per conversion for two types of Google Ads campaigns, search and Local Services Ads (LSA):
Search ads are the traditional type of Google Ads that appear in search engine results. As you can see the average cost per conversion of search ads for Marketing 360® varies greatly by industry. This is due to the competition in each industry and the CPCs of the keywords within the industry.
Lowering your cost per conversion is possible, even in a competitive industry.
And, the same tactics used to lower CPC can be used to lower cost per conversion.
Local Services Ads
Local Services Ads are a relatively new type of Google Ad that can help connect local businesses with potential customers. The average cost per conversion of LSA campaigns is lower than search campaigns, they show up at the very top of the page (even above the search ads) on Google and they tend to be more effective for local businesses.
Best of all, Google LSA is a pay-per-lead program, which means you only pay for qualified leads.
To participate in the LSA program, you must be in an eligible service category and meet the requirements for Google Guaranteed, which includes passing a background check and having at least five reviews on Google.
Google ad campaigns and the learning phase
When you create a new Google Ads campaign, the algorithm needs time to learn and optimize for the best results. This is called the learning phase.
During the learning phase, the Ads Specialists at Marketing 360® analyze data from the ad campaigns to determine which keywords, targeting, ad copy and other factors are effective at achieving the desired results. The learning phase typically takes several weeks to a month, during which time our team gathers data and makes adjustments to improve performance.
It's important to note that during the learning phase, the performance of the ad campaign may be unpredictable and not yet optimal. Therefore, when you turn on Google ad campaigns, you cannot expect to receive leads or conversions immediately.
It takes time for the algorithm to learn and optimize the campaign to achieve the best results. As such, it is recommended to wait until the learning phase is completed before making any significant changes to the campaign, such as adjusting targeting or ad copy. By allowing the algorithm to complete the learning phase and optimize the campaign, you can increase the chances of achieving better results and maximizing your return on investment.
Google Ads is a powerful tool for small businesses to reach potential customers and grow their businesses. With the right strategy and knowledge, you can maximize the performance of your campaigns and get the most out of your budget.
At Marketing 360®, our Ads Specialists are experts in Google Ads and use a variety of tactics to maximize the performance of campaigns, helping us to achieve above-average results across many different industries.