When determining your online advertising budget for Google Ads, you will be putting all your money into keywords. The cost of a keyword is determined by your industry, competition, location and quality score. Many of these factors are predetermined by utilizing the resource called the Keyword Planner. This article breaks down how you can use the Keyword Planner to determine your online advertising budget.
What is the Keyword Planner?
The Keyword Planner is a resource in the Google Ads interface and a great tool to help you determine your keyword metrics, such as:
Searching for New Keyword Ideas:
Type in keywords relative to your business and discover new keywords. In this example, we will be working with a Ford F-150 Campaign and enter the keywords “ford f150” & “2019 ford f150.”
This populates more than 1,600 keyword ideas related to the two keywords we entered. We can search through the list of relevant keywords and add them to our campaign if needed.
After adding the average monthly searches column, we can see how often your ads can appear based on your targeted locations. For this example, we’ll use Schaumburg, IL. The search volume numbers are also based on the previous month’s data provided by Google.
Keyword Competition & Cost
After adding the top of page bid column, we can see the cost of your industry’s keywords in your targeted location. The higher the cost, the more competition in your target area.
We add 25-30 keywords in our F-150 campaign, totaling 3,000 average search volume in our targeted locations. Checking the competition and top of page bid (high range), we have a cost per keyword of $7.50. According to Wordstream, the average click-through-rate of the automotive industry is 2.14 percent. With that in mind, of our 3,000 searches only 2.14 percent potentially could be clicked on.
search impressions x click-through-rate = potential clicks
3,000 x .0214 = 64
potential clicks x top of page cost = monthly budget
64 x 7.50 = $480
$480 is a starting point for our F-150 campaign budget in our targeted locations. As your Google Ad campaign grows, you will add or subtract new target areas/location/geos based on your marketing goals. However, before making those changes, address the Keyword Planner and see what changes may take effect.
At Aronson Advertising we can make those changes for you and give you a recommendation for your online advertising budget, Contact our search engine marketing experts by calling (847) 297-1700 to start the conversation today!