Google Adwords Budget Estimator: How to Create Your Advertising Budget


Want to increase your business’s online presence by investing in Google Ads?

Google Ads is a great tool to get traffic to your site. But before you start spending money on ads, you should consider these 3 key factors.

Let’s cover some of the basics.

Advertising through Google Ads has become a common practice for businesses looking to promote their brand or sell their goods and services. The program allows advertisers to bid on keywords related to their niche. When someone searches for those terms, they see the ad displayed at the top of the page. If they click on the link, they’ll be directed to the advertiser’s website.

Expanding your digital presence is key to growing your business in this day and age, and with Google’s Paid Ads, you don’t pay for an ad that hasn’t brought traffic to your site.

In fact, Google Ads has continued to grow in significance. This is especially true since Google moved all paid results out of the sidebar in 2016, pushing organic results further down the page and making google ads almost indistinguishable from normal search engine results and rankings.

Benefits of Paid Ads

Paid ads are a great way to get the word out about your business. They can be an effective tool for getting new customers, but they also have some benefits that you should know about before you start using them.

1. Increased Traffic

One of the biggest advantages of paid advertising is increased traffic. When people see your ad on Google or Facebook, it’s likely that they will click through and visit your website. This means more potential customers who may become loyal clients in the future.

2. More Conversions

Another benefit of paid advertising is that it increases conversions. People tend to spend more time on websites where there are lots of ads, which makes sense because they want to find what they need as quickly as possible. If you pay for ads, you’ll get better results than if you just rely on organic search engine optimization (SEO).

3. Better ROI

The final advantage of paid advertising is that you can track how well each campaign is doing. You can use this information to improve your campaigns in the future. It’s important to note that not all paid advertising strategies work equally well. Some methods are much more expensive than others, so you need to choose one that fits your budget.

Businesses make an average of $2 in revenue for every $1 they spend on Google Ads. (Source: Google Economic Impact Report)

So if you want to make the leap to do Ads getting your budget right is going to be critical

It’s not easy building an Ads budget. For beginners, it’s even tougher. Creating a successful Ads campaign requires careful planning and consideration of both the budget and expected return on investment (ROI).

But where do you even start? Without having some sort of Google Ads budget estimator, you may feel clueless about how much money to commit to your Ads budget and what sort of results to expect in return.

There are several factors that come into play when it comes to deciding on a budget, and it is important to plan carefully to get the best return on your investment.

3 Key Factors In Your Google Ads Budget Estimator


Your overall advertising cost will depend on the price of the specific keywords you want to target. You may pay $5.83 for an ad with the keyword “orthopedic practice,” but $25.80 for “home mortgage.” Your product and services, as well as the popularity of and competition for your desired keyword, will determine the advertising cost.

Fortunately, you don’t have to guess in the dark for these numbers. Google’s Keyword Planner Tool is an incredibly helpful part of any Ads budget estimator toolkit.

Keyword Planner allows you to see how many people are searching for a particular keyword and what their search intent is. It also gives you some insight into how much competition there is for that term.

We recommend using other keyword strategy tools, such as SEMRush, to help you narrow down a comprehensive target keyword list.

SEMRush helps you find the right keywords to target based on your audience, industry, location, and more.

Once you have your keyword research completed, it’s time to find out which keywords are most relevant to your website and business. This is where Google Ads comes in handy. You can use this tool to determine what type of traffic each keyword will bring to your site.

For example, if you sell shoes online, you may want to focus on “shoes” or “buy shoes online” keywords. If you sell clothing, you might choose “clothing” or “fashion clothes.”

Time Frame

In estimating a budget for Google Ads, you also need to determine how long the ad should run. People tend to think that they can just setup a Google Ads campaign and be profitable right out of the gate. While Google Ads is significantly faster that SEO, it doesn’t mean that the campaign is honed and is “pointing in the right direction.

From a time frame perspective, don’t think that it’s a silver bullet.

Constant optimizations and check-ins are required for campaigns to run smoothly.

To determine your time frame, there are a few important pieces to keep in mind.

  1. Consider the search volume for your intended keywords; lower search volumes may require a longer running campaign.The more you can target, the better. But keep in mind, If you’re targeting too broad of terms, it will be harder to rank in Google and other search engines.
  2. If this is a brand new campaign, it can take up to three months to gather a significant baseline of data before you can adjust and optimize your campaign. This should factor into both your time and cost estimates.
  3. Keep in mind the seasonality of your products or services; if you typically see a summer slump in sales, you should expect a similar slowdown in Ads performance.
Finally, to create an effective estimate for your Google Ads budget, you need to have clear data about your sales cycle and conversion rates.

If you don’t know what your cost-per-acquisition is currently, it’s a good time to calculate that now before implementing a Google PPC campaign. A few questions you should be asking yourself are:

  • How long is your typical sales cycle?
  • After a visitor arrives on your website, what other conversions (or actions) need to take place?
  • What is your conversion rate for each of these actions?
  • What’s to total investment in each complete sales cycle?
  • Are you using Ads to start the process so you can continue to market to that individual through your other forms of marketing?

Ads Pro Tips

If you have a high close rate, but low conversions, then you need to make sure that the content is engaging enough for people to want to buy from you. If you have a low close rate, but high conversions, then you need more compelling content or better copywriting skills.

The best way to find out what works is to test different versions of your Landing pages with A/B testing software like Optimizely or Hubspot. This will allow you to compare two versions of your site (or pages) side by side and see which one converts better.

You can also use Google Analytics to track how many visitors come to your site, where they are coming from, and what actions they take when they get there.

Once you have these numbers pinpointed, combine them with the time frame and keywords you’ve targeted to determine your estimated Ads budget. This will help you determine what reasonable expectations to set for the PPC campaign and the budget you are able to provide your Ads campaign at this time.

Setting Realistic Expectations from Ads

Is Google Ads the only way to build your online presence? Of course not. Organic SEO can be a highly successful strategy for many businesses, especially when they incorporate Google’s best practices into your approach.

Just remember that Google has moved paid advertisements to the main search results area of the page results, moving organic rankings lower on the page. A professional SEO consultation may be the SEO boost you need if a Google Ads campaign just isn’t a part of your marketing budget at this time.

Can Google Ads get you great results? Yes, with testing, adjustment, and patience. It’s vital to keep in mind that Google Ads is not something you can start on Monday and see wild success in by Friday.

If you want to make money online, then you need to be willing to put in the work.

If you don’t have a budget for paid advertising, you should consider other ways of getting traffic to your website.

SEO is considerably cheaper than paid advertising, however, like mentioned before on this page, you are able to laser focus on different audiences at a faster rate with paid advertising.

Just because you get set up on Monday, it doesn’t mean you’re gonna have the ball rolling by Friday.

We highly recommend you involve a professional who will set this up for you. You can spend a lot of time and money on setting things up, only for them to fail later. Professionals have the effectiveness and efficiency to set up and upkeep the campaigns.

It takes time, trial and error, and constant adjustment.

Tip: Start small

When it comes to advertising budgets, most people start big and work down from there. But starting small might actually help you save money over the long run. A recent study found that while ads with lower bids typically perform better, advertisers tend to spend more per impression when they bid high.

If you’re first starting out, try an average daily budget of around $10-$50. With daily check ins on your campaign results, you can optimize accordingly.

The research showed that bidding $0.25 per ad impression yielded the best ROI. However, spending less than $1 per day on Google Ads could mean that you are missing out on potential conversions.

Action Items & Takeaways

  • Brainstorm the keywords you would like to run ads for. Estimate their cost using Google’s keyword planner.
  • Determine your ad time frame, based on keywords, age of the campaign, and seasonality.
  • Identify your on page conversion rate and your sales team’s close rate.
  • Calculate your potential spend using your Google Ads budget estimator.
  • Set up your ads and start testing! You won’t see any results right away. You have to wait for someone to click on one of your ads before you make money. This is why it’s important to test your campaigns before going live.
  • Once your ads are running, schedule a consultation to find out how to get the most out of PPC by increasing your on page conversion rate.
    For more quality paid advertising marketing tips, sign up for our newsletter or schedule a 1 on 1 complimentary consultation.Farotech has helped hundreds of businesses grow by helping our clients build marketing systems that generate leads, nurture leads into clients, and ultimately convert clients into raving fans of your brand, vision, products, and services.

We work closely with our clients to understand their goals and objectives, then develop a strategy to achieve those goals, using our unique process that has been perfected over the last 21+ years.

If you have any questions about our agency or approach, please contact us and we will get back to you shortly. We look forward to working with you!