How to set Google Adwords Budget? A detailed guide on how to lower your CPC

Google provides an advertising facility to businesses who want to showcase their ads on the wide range of Google’s advertising network, i.e., Google AdWords. This advertising program enables the business to create a Google AdWords budget. The business only has to pay when a person clicks on their particular ad. This is different to how SEO works and paid ads should be a part of your arsenal in 2018 and moving forward.

How to set a Google AdWords budget is one of the most challenging questions that marketers have to face regardless of their experience in the field. Planning AdWords budget can be grueling and thankless, both at the same time. However, budget planning plays a pivotal role in achieving success with AdWords.

Another thing that you should know while creating a budget for Google AdWords is how to lower your CPC. CPC is short for Cost per Click. It is the cost you pay to search engines, like Google, whenever a person clicks on your ad. Understanding how to manage the CPC to further understand the AdWords campaign is quite important for a marketer.

Read on to know how you can set a Google AdWords budget and decrease your CPC. In order to assist you in having a proper Google Adwords budget, here is a step-by-step guide to help you with your budget creation so that you can minimize your spending accordingly:

Calculating an initial budget

After adding your credit card details and funding your account, you have downloaded the AdWords Editor and are now wondering how much will be spent in the first quarter. Instead, you should be thinking about entirely separate questions such as:

1. Where do AdWords fit into your existing marketing strategy?

Take into account all the marketing channels you are spending on. It could be billboards, radio spots, commercials, etc. So, you need to see whether the Adwords account you are using is helping you out with the marketing efforts you have done already or whether you want AdWords to take their place now? This will help you in deciding the cost-cutting in your business.

Initial Budget

2. How much are you spending on CPCs?

In order to set a budget, you must know how much the keywords are costing you. This is a good start point but you should focus on more questions. Check the popularity of your keywords and your competitors’ keywords by opening the AdWords Keyword Planner.

Keyword Research

Check this specifically for your services or products page. You want low competition, so you can always use the search terms that are not that commonly used by your competitors and generate high traffic for your page.

3. What are the areas in which your competitors are spending?
There are various tools available online that will help you in gauging the areas where the AdWords budget of your competitors is getting spent. Once you determine this, you can make use of affordable keywords, which your competitor didn’t use. So, closely keep an eye on your competitor’s AdWords budget.

Buyer’s Persona

Buyer’s Persona is a detailed profile of your potential customers. This offers various insights on what they are searching for, thus providing you with valuable information on how to create targets. This is an underrated method that helps in setting an AdWords budget.

Buyer’s Persona reacts to different ad clicks, messaging, customer categories, conversion of the various landing pages, etc. So, you need to understand Buyer’s Persona in order to create a budget for Google AdWords.

Use the Shared Budgets feature

The Shared Budgets feature provided by Google AdWords that helps you in making a daily budget that can also be shared across multiple campaigns present in a single AdWords account. This feature largely helps in matching the costs spent in using Adwords to your business objectives and marketing strategies. Plus, it does not allow the splitting up of campaign distributions.

Suppose if the entire marketing plan of a particular day in your business is of $100, you can break the amount down among various campaign subcategories you are working on. This allows easy allotment of funds of a particular day in all the campaign subcategories. In addition to this, Google AdWords adjusts campaign budgets automatically. This means you do not need to manage and update individual budgets allotments to all the subcategories in a day.

Allotting a budget across AdWords search campaigns

Logically speaking, you may think that spending on your the top keywords performers. But what about the rest of the keywords? So, deciding how to spend on each type of keyword should be done strategically due to the many tools available online. We will talk about the types of keywords and how they provide cost-effective solutions in the next section.

How to lower your CPC?

Now, that you know how to set a Google AdWords budget, you can take a look at a detailed guide from which you can lower your CPC which will also help you create an amazing budget:

1. Lower the bids

By lowering the bids, Google will charge a lower maximum CPC calculated on every click of your ad. By doing this, you will be able to get more clicks within the allotted budget. Plus, this will give you more exposure on Google and hence, providing you with more leads.

2. Concentrate on Quality Score

A quality score is basically the rating provided by Google citing all your keywords relevance. It also rates on the basis of ads and landing pages. The quality score provides information about the payment you need to make on each click and your ads positioning as well. Whenever you make ads that are according to the search queries and hence, are highly targeted, then it results in the rise of CTR (Click through Rate). A rise in CTR, increases the Quality Score, therefore increasing as rankings by lowering the CPC.

Qual Score

3. Avoid high-cost keywords by using long-tail ones

If the genre of your business is highly competitive in today’s market, the average CPC will cost you more. So, you can avoid the high costing keywords and find some long-tail keyword substitutes. In addition to this, long-tail keywords have greater Quality Scores. Google ranks you by multiplying Quality Score by maximum CPC bid.

4. Modify the ads and make them more relevant

If your ad appears to be ‘Below average,’ in the ad relevance tab of your ad, this means your ad is not relevant as compared to your keywords. In such a situation, you can change the ad or make a new one. One way to increase relevance is by adding keywords to the ad’s description and headline. If your ad becomes of a higher relevance, the Quality Score will rise, which will, in turn, lower the CPC.

5. Try incorporating negative keywords

Negative keywords help in removing unnecessary search queries, which, in turn, help in lowering of the CPC. This maintains a good CTR that increases Quality Score. Additionally, a Quality Score in important in decreasing the CPC. Hence, this will help in showing your ad to those people who would be interested in your products and services.

6. Ad Scheduling

Ad Scheduling is a standout feature that helps save on your ad budget. In this feature, you can select the day and time at which you want to run your ad. Showing your ad to potential customers at all times will reduce your ROIs too. So, just be sure of the day and time that your potential customers will be free to check out your ad and go ahead with that. This will reduce the possibility of getting any unnecessary clicks that can increase your CPC.

7. Make use of Geo targeting

Geotargeting feature works best when you want to search for the regions in which you will get your potential customers. The ads can be put up according to location. You can target a particular radius of a location, a postal code, region, city, or even the whole country. Sharing your location will prove useful for you to target your audience. In doing so, the CTR will improve, thereby increasing the Quality Score, which is automatically good in lowering your CPC.

8. Create ad groups according to a theme

To increase Quality Score and reduce CPC, you can make themed groups. To achieve this, you will have to make your ad groups and keywords according to the products/services you offer and wish to sell online. Allot different ad groups to different products/ services and select an ideal landing page for them. Doing this will make sure your Quality Score increases thereby reducing CPC.

So, now you know how to budget for Google AdWords by considering and working on the above-mentioned things. Budgeting is important while running a business and money should be saved whenever possible. But yes, it should not be done at the cost of compromising something in your business. In addition to this, you know by now that there are so many ways in which the CPC can be reduced in order to run a successful advertising campaign by using Google AdWords.

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