Are Google Ads worth it?
It’s a frequent question business owner ask themselves, since on paper Google Ads seems like an amazing way to build a new stream of customers and revenue sources.
Google Ads is a worthwhile investment for any businesses, however to properly make profit out of paid ads a company must invest time, effort and money into its baisc business processes so they can transform Google Ads traffic into actual paying customers, which is something few businesses can do correctly.
Overall, the biggest selling points of Google Ads are it’s incredible ease of use, with an intuitive and logical interface, very low cost of entry (can start ads with as little as $2), lots of different ad types, excellent reporting, and a huge audience you can reach.
The downsides involve very high costs for certain niches, coupled with extensive amount of time and work required to properly figure out how to integrate Google Ads into a business’s day-to-day processes.
9 Reasons Google Ads are worth it
1. Very easy to use interface
The Google Ads interface is powerful and has lots of features, but it’s surprisingly easy to use.
Yes, there’s a lot of stuff going on. However, almost every feature is self-explanatory and the overall logic behind Google Ads is easy to grasp.
Finally, there are countless, very high quality and up to date video and written tutorials that explain the ins and outs of Google Ads.
Some examples:
2. Instant traffic, whenever you want it
The biggest advantage and selling point of Google Ads is that you can get instant traffic and potential customers visiting your business’s website.
Signing up for Google Ads is hassle free and takes a few minutes at most.
Next is filling your account with some starting money and creating your ads.
Creating an ad is also straightforward and takes just a few minutes if you just want to get something running.
If you want to get familiar with all the settings first, it can take around 2-3 hours.
When launching an ad they will first go through an approval process. During this approval process a Google rep will make sure ad respects the Terms of Service.
Usually this is a routine procedure and most ads get approval within a few minutes. Even if you don’t get approved right away, you will receive an error message that explains why your ad was denied and how to fix it.
Once you’re ads are approved they’ll start running and you’ll be getting visitors to your site within a few minutes.
3. You don’t need a large budget
Google Ads does require an initial budget to start a few ads and measure their performance.
However, $200-500 is often enough to figure out if ads are a worthwhile investment, or if you should focus on other marketing channels.
Keep in mind though, that’s in the USA. If you’re from a different country such as UK, Canada or France the price can go down a bit further, so you would need $100-300 to get the same results.
Other countries such as India or Eastern Europe have even lower prices. $30-100 will often be enough to figure out if you should continue investing or not.
4. Lots of different types of ads
Google Ads offers a lot of different types of ads, depending on what kind of products and services you’re offering and how you want to promote them:
- YouTube video ads
- Search ads
- Display ads
- Shopping ads
- Discovery ads (YouTube text ads, Gmail etc.)
5. Target the exact keywords you want
Google Ads allows you to target users who search for a particular keyword. If you don’t tinker with the default settings, then Google will widen the net so it shows your ad to anyone that that has your target keyword in the search query.
For example, if your target keyword is “tapioca”, then your ad will also appear for the search query: “are tapioca seeds good for muscle building”.
If you don’t like this wide targeting, you can change settings in Google Ads so it targets users who type that exact keyword (for example your ad will only show if the user types in “tapioca”, but not “tapioca seed price”).
This is just an example of Google’s targeting power. There’s a ton of ways you can customize who, when and how a user can see your ad:
- Location (country, city, street etc.)
- Hourly interval.
- Preferred device (mobile, desktop, tablet).
- Gender.
- Age range.
- Ad campaign budget.
- Maximum cost per click.
- And many more.
6. You can target niches and interest groups
Google has a ton of information about people, gathered from all kinds of places.
Google uses this information to segment its users based on interests, hobbies, location, language etc.
With so many data points it’s possible to be very specific and surgical with the audiences you want to advertise to.
7. Go hyper local or world wide
Knowingly or not, many smartphone users allow Google access to their geolocation data.
This in turn allows advertisers to only target users in specific locations. This works very well if you have a very local, retail business such as a specialty store.
8. Extremely easy to track performance & spend
Google Ads has it’s own statistics tools to measure how many click & conversion you’re getting.
On top of this, nearly every type of business software (such as Etsy, Shopify or customer management tools) has deep integration with Google ads.
This allows you to connect your main business software tool(s) to Google Ads and directly measure from there how well your ads are performing.
Finally, Google doesn’t have a “minimum spend”. If you just want to experiment with Google Ads, you can just fill your account with $10-25 and play around with the settings and running a few ads to see what kind of traffic you’re getting.
You can also adjust how much money you’re willing to spend every time a (new) user clicks on your ad.
Finally, you can even find Google Ad vouchers, especially if you’ve never done them before.
9. You can retarget users who already visited your site
There’s one type of Google Ads campaign that is profitable in almost all cases: retargeting.
In short, retargeting are the notorious ads that “follow people around from website to website”.
Although they’re rather invasive, they’ve always had an exceptional return on investment since the ads always target users that have shown interest in a product or service (visiting a website, adding to cart, pressing buttons on a site etc.)
Google is able to create ads like these because it has a massive partner network of millions of websites. Google then tells these website what ads to show and to whom.
Through retargeting, you create a user list in Google Ads of all the people that have visited your website.
You can then segment this user list based on what kind of actions users have done on your website.
As an example, imagine having 1000 visitors on your site, which you then divide in 3 segments:
- 600 did nothing except view products
- 300 added products to cart, but abandoned the cart and didn’t finalize purchase.
- 100 bought a product.
Through retargeting, you can, for example, create 3 kinds of ads, with each ad targeting one particular segment:
- For the 600 users: show an ad about products they haven’t seen but might be interested in.
- For the 300 users that abandoned cart: make an add that offers a 5-10% discount if they complete the purchase.
- For the 100 users that purchased a product: make an ad that offers them “follow-up” products.
5 Reasons Google Ads are not Worth it
1. Some niches are extremely expensive
Google Ads usually charges you on a per-click basis. The cost of a click is set through an auction system.
For example, you and 19 other companies want to appear in search results for the keyword “home decor los angeles”.
Since ad slots are limited (around 4-5 per page), Google will use an algorithm, that is extremely similar to an auction, to determine which ads are displayed and which aren’t.
In almost all cases, the biggest factor that determines if your ad is displayed or not is if you outbid your oponents by having a higher “bid per click”.
The problem is that some industries (especially in the USA) are extremely expensive because all the auction players have a ton of money to throw into the system.
As an example, a lawyer in New York can easily expect to play $20-30 per click. So not a phone call or email, just a simple click on an ad that takes the visitor to your site.
If you get 10 clicks, but no new customers then you’ve just burned $200-300.
To be clear, not all niches are so expensive. The ones that are usually focused around legal, insurance, finance and similar industries.
Finally, part of the reason they’re so expensive is because they are very profitable, so many of the players are flush with cash and can afford to spend this money.
2. Turning ad visitors into customers is a difficult skill
For Google Ads to be profitable, a business really needs to have a good system in place to convert interested visitors into actual, paying customers.
This can mean having a good looking website that properly communicates the quality of your products and services, as well as offering a simple, elegant way to get in touch with the business and become customers.
For businesses that rely on phone calls, this can mean always having someone available to pick up the phone and offering customers a top notch sales pitch.
Businesses that have good systems in place can afford to pay even $20-30-40 per click, since they can turn these clicks into paying customers that not only compensate the expense, but make a healthy profit.
3. Competition from established businesses
Companies that have good systems of converting paid clicks into actual customers are extremely tough competitors in the Google Ads auction, since they know can absorb high click prices.
As such, a few of these participants can raise the auction prices so much that Google Ads becomes unprofitable for most other businesses that aren’t able to turn clicks into customers.
In other niches, the auction price is inflated by giant multinational corporations (think Coca-Cola), that essentially carpet bomb the online ad space.
These companies don’t expect to make a sale out of these online ads. Instead, they want to maintain their brand power and mindshare.
However, the money these companies pump into the auction raises the price for everybody else.
4. It’s hard to measure the value of your customers
Imagine you’ve just started a hairstyling salon and want to use Google Ads to build a customer base.
Depending how much competition there is in your location, it’s entirely possible you might have to spend $300-400 just to get a single customer that pays $50-60 for a haircut.
That might sound like a very bad deal, but many customers of hairstyling salons are long term, repeat clients.
So even if you spent $350 just to get a single customer, you will make that money back within a year if the client becomes a regular of yours.
Then you also have to take into account word of mouth. If that single customer likes your work a lot, then he might recommend your salon to another 1-2 of their friends.
This “measurement problem” is very important to solve if you really want to make the best of Google Ads (and any marketing channel in general).
Businesses that have a strong grasp of the average lifetime value of their customers can afford to spend a lot of money on acquiring individual customers, since they have a clear idea how much revenue they can expect to make.
5. It can take a long time to make Google Ads work
Learning how to use the Google Ads platform itself is fairly straightforward.
The hard and time consuming part is figuring out how to integrate Google Ads in your business processes so that it becomes profitable and sustainable.
A lot of the times this means asking customers where they learned about your business and keeping track of the answers, measuring how much money a customer usually spends on your business, figuring out a good sales pitch etc.
The end result is that you’ll often have to spend weeks or even months of work setting up your business processes so that Google Ads can truly become profitable.
On the positive side, such processes are extremely healthy for any business (even those that don’t use Google Ads) and can provide a lot of valuable information you can use to improve the business.