With rising CPCs (133% increase in 2024) and tighter budgets, managing ad spend is harder than ever. But Google Ads still delivers a 200% ROI - if you optimize correctly.
Key Strategies to Save Money:
- Eliminate wasteful spend: Use negative keywords and refine audience targeting.
- Boost Quality Scores: Improve ad relevance, landing pages, and page speed.
- Leverage first-party data: Target high-converting audiences with precision.
- Smarter bidding: Use Target ROAS or CPA for better ROI.
- Optimize product feeds: Align ads and landing pages to user intent.
Quick Wins:
- Monitor key metrics like CTR, CPC, and ROAS.
- Use ad scheduling to focus on peak performance times.
- Add extensions (sitelinks, promotions) to boost CTR for free.
By targeting the right audience, improving ad quality, and fine-tuning bids, you can reduce costs while maintaining sales.
Let’s dive into the details.
How To MASSIVELY Reduce Google Ads Cost Per Click
Audit Your Google Ads Performance
The average eCommerce conversion rate hovers around 2.5–3%. This makes it crucial to pinpoint campaigns that aren't delivering results.
Key Metrics to Monitor
To manage costs effectively, start by analyzing these important metrics:
- Click-Through Rate (CTR): Current benchmarks fall between 0.2–0.3%. A CTR above 2% is considered strong.
- Cost Per Click (CPC): Compare your CPC to industry averages to ensure you're staying competitive.
- Quality Score: Impacts both your CPC and overall campaign expenses.
- Return on Ad Spend (ROAS): Measure this against your target ROAS to spot underperforming campaigns.
"CTR is the number of clicks that your ad receives divided by the number of times your ad is shown: clicks ÷ impressions = CTR." - Google Ads Help
Reports You Need to Set Up
Use these reports to stay on top of campaign performance:
- Campaign Performance ReportGo to Campaigns > Insights and Reports > Report Editor. Schedule weekly email updates to keep track of trends.
- Search Terms ReportSee the exact terms users search before clicking your ads. This helps you eliminate irrelevant clicks that drain your budget.
- Keyword Performance ReportIdentify which keywords are driving results and which ones are wasting money without converting.
Spot Inefficient Ad Spend
Watch for these red flags:
- High Bounce Rates: Suggests your landing pages don't align with user intent.
- Slow Load Times: Every extra second of load time (within 0–5 seconds) can reduce conversion rates by 4.42%.
- Low Quality Scores: Drives up costs across your campaigns.
Warning Sign | Impact | Action Required |
Load Time > 4s | -4.42% conversion rate per second | Optimize page speed |
Zero Search Results | 80% visitor drop-off | Adjust keyword relevance |
Low Quality Score | Higher campaign costs | Improve ad and landing page match |
Tackle High-Impact Areas
One quick win? Ad Scheduling. Analyze performance by time and day, then focus your budget on peak converting periods.
Once you've identified wasteful spending, the next step is to refine your targeting.
Improve Ad Targeting
Refine your targeting strategy to cut down on wasted ad spend and focus on reaching the right audience.
Reach the Right Audiences
Dive into your customer data to identify key demographics and behaviors. Allocate your budget to audiences with the highest likelihood of converting.
Here are a few ways to create targeted audience segments:
- Website Visitors: Focus on people who visited specific pages or categories in the last 30 days.
- Customer Match: Use email lists of existing customers to re-engage them with tailored ads.
- Similar Audiences: Target individuals who share traits with your most loyal customers.
"Effective paid search management means consistently expanding the keywords you're bidding on while simultaneously refining the keywords you're already bidding on to maximize relevance and, as a result, ROI." - Allen Finn, Co-founder, Toasted Collective
Use these insights to cut out irrelevant traffic in the next step.
Add Negative Keywords
Once you've identified your ideal audience, go a step further by excluding unqualified searches with negative keywords.
Negative keywords ensure your ads won't appear for irrelevant queries, helping you save your budget for clicks that matter. Apply them at three levels:
Level | Purpose | Example |
Account | Block universally irrelevant terms | "free", "DIY", "how to" |
Campaign | Filter out category-specific terms | "wholesale", "bulk orders" |
Ad Group | Eliminate product-specific terms | "repairs", "used" |
Check your Search Terms report weekly to uncover new negative keywords. Focus on terms with high impressions but little to no conversions. Once you've tightened your keyword list, it’s time to fine-tune your match types.
Adjust Keyword Match Types
Now that you've filtered out irrelevant clicks, optimize your match type settings to better align with user intent.
For eCommerce businesses, exact match and phrase match keywords often strike the best balance between relevance and reach.
- Exact Match Keywords: Ideal for high-converting terms. Bid higher on these to capture clear purchase intent and monitor performance closely.
- Phrase Match Keywords: Use these for broader product categories. Set moderate bids to capture variations while using negative keywords to block irrelevant matches.
Instead of relying on broad match keywords, try using Dynamic Search Ads to uncover new, valuable search terms. This approach gives you more control while still helping you discover keywords you may have missed.
For example, a kitchen furniture retailer boosted their return on ad spend (ROAS) by creating a remarketing audience based on searches for "chairs." They targeted previous visitors who had shown interest in kitchen chairs and paired this with a special discount offer. This strategy successfully brought customers back to complete their purchases.
With these targeting improvements, you're better positioned to enhance ad quality and fine-tune your bidding strategy.
Boost Quality Score
Once you’ve nailed down precise targeting, the next step is improving your Quality Score. Why? Because a higher Quality Score not only boosts your ad visibility but also lowers your cost per click. Here’s how you can make improvements in key areas.
Write Better Ad Copy
Your ad copy plays a big role in your click-through rate (CTR) and Quality Score. To get better results, write text that aligns with user intent and highlights the benefits of your offer. For example, instead of using something generic like "Best Deals", try something more specific:
"Get 25% Off Your First Purchase – Free Shipping. Shop our limited edition today and get free shipping for purchases above $50. Order now while supplies last!"
When crafting your ad, include elements like:
- Clear value propositions that tell users exactly why they should click.
- Time-sensitive language to create urgency.
- Trust signals like customer reviews or ratings.
- Location-specific details to make your ad more relevant.
- Strong calls to action that drive immediate engagement.
Once your ad grabs attention, your landing page needs to follow through on the promise.
Fix Landing Page Issues
A poorly optimized landing page can hurt your Quality Score and drive up costs. Common problems include slow load times, irrelevant content, and poor mobile usability. Here’s a quick breakdown of issues and solutions:
Issue | Solution | Impact |
Slow Loading | Use a CDN, compress images, and minify code | Improves Core Web Vitals |
Content Mismatch | Align landing page content with ad promises | Increases relevance score |
Poor Mobile Experience | Implement a responsive design | Enhances user engagement |
Weak Trust Signals | Add testimonials and SSL certificates | Builds credibility |
Speed optimization should be your top priority since it affects both user experience and Quality Score. Use Google's Core Web Vitals - like Largest Contentful Paint (LCP), Interaction to Next Paint (INP), and Cumulative Layout Shift (CLS) - to guide your updates.
Set Up Ad Extensions
Ad extensions give your ads extra details for free, which can increase your CTR. For instance, Blue Water Marketing saw a 15% jump in CTR after using sitelink extensions for an online retail client.
Here are some must-have extensions for eCommerce:
- Sitelink Extensions: Direct users to specific product categories or sale pages.
- Price Extensions: Display product prices upfront, which can improve CTR by about 8%.
- Promotion Extensions: Highlight current deals and discounts.
- Image Extensions: Add product visuals to your ads.
- Seller Ratings: Showcase customer reviews and scores.
For example, an online electronics retailer boosted conversion rates by 10% by adding callout extensions that emphasized perks like "Free Next-Day Delivery" and "30-Day Returns". Be sure to keep your extensions updated with seasonal offers or inventory changes, and track their performance regularly in your Google Ads dashboard.
Update Bidding Methods
Once you've improved your Quality Score, it's time to fine-tune your bidding strategy. This helps reduce costs while maintaining strong sales performance.
Choose the Right Auto-Bidding Strategy
Google's automated bidding relies on AI to adjust bids. For eCommerce, the top choices are Target ROAS (Return on Ad Spend) and Target CPA (Cost Per Action).
Here’s a quick guide to help you decide:
Strategy | Best For | Requirements | When to Use |
Target ROAS | Products with varying values | 15+ conversions in 30 days | When conversion values differ significantly |
Target CPA | Similar-value products | Consistent conversion tracking | When all sales have similar value |
Maximize Conversion Value | New campaigns | Limited historical data | Before switching to Target ROAS |
Start with Maximize Conversion Value to gather enough data. Once you hit 15 conversions in 30 days, switch to Target ROAS. After that, focus on optimizing your bid limits for greater control.
Set Smarter Bid Limits
Once you've selected your auto-bidding strategy, calculate your max CPC (Cost Per Click) by dividing your daily budget by your target number of clicks.
For instance, if your daily budget is $100, you want 50 clicks, and your target CPA is $20, your max CPC would be:
- Daily budget ÷ Target clicks = $100 ÷ 50 = $2 max CPC
To refine your bid limits:
- Start with lower bids, increasing them gradually based on performance.
- Raise bids for keywords that drive more conversions.
- Lower bids for broader match types that may bring in less relevant traffic.
- Aim for positions 3–4 in search results to get better ROI.
Fine-Tune Bids by Device and Location
After setting bid limits, adjust bids based on device performance and location data. You can modify bids by as much as -90% to +900% for precise targeting.
Device Optimization
Check your dashboard to see which devices perform best. For example, if mobile users have a 20% higher conversion rate, increase mobile bids by 20%. A $1 base bid would then become $1.20 for mobile users.
Location Targeting
Focus your budget on areas that deliver the best results. To adjust location bids:
- Go to Campaigns > Audiences, keywords, and content > Locations.
- Add specific locations and set bid adjustments.
- Review performance weekly to refine your targeting.
Keep in mind that multiple bid adjustments combine together. For example, a device adjustment and a location adjustment will multiply, so use them carefully to avoid overspending. Regularly monitoring and tweaking these settings ensures you stay on track while managing costs effectively.
Organize Your Account Better
A well-structured account helps reduce costs and maintain strong performance.
Group Similar Campaigns
Organizing campaigns around similar themes makes tracking and optimizing much easier.
- Use Single Theme Ad Groups (STAGs - with caution)STAGs combine related keywords, ensuring better keyword coverage while keeping relevance high. Here's how they typically perform:
- Median CTR: 4.99%
- Median CPC: $1.79
- Median conversion rate: 4.61%
- Median cost per conversion: $34.61
- Align Ad Groups with Your Website StructureBase your ad groups on how your website is organized. For instance:
- Dresses
- Tops
- Pants
- Shirts
- Pants
- Outerwear
"Slicing bread makes it easier to handle, easier to enjoy, and easier to rub on your face... segmentation makes your campaigns more manageable and easier to improve." - Johnathan Dane, CEO & Founder
Once your campaigns are grouped logically, the next step is setting bid priorities.
Set Bid Priorities
Bid prioritization ensures your budget goes to the campaigns that matter most. Google Ads offers three priority levels: High, Medium, and Low.
Priority Level | Best Used For | Budget Impact |
High | Time-sensitive offers, seasonal sales | Gets first bid opportunity |
Medium | Regular promotions, standard inventory | Bids after high-priority campaigns |
Low | General catalog, lower-margin items | Captures remaining opportunities |
- Use inventory filters in campaign settings.
- Focus on promoting high-margin products.
- Assign lower priorities to broader campaigns targeting general audiences.
After setting bid priorities, you can further refine your budget management with shared budgets.
Manage Shared Budgets
Google's shared budgets automatically shift funds to campaigns with better performance.
"When used with Portfolio Bid Strategies, shared budgets can be utilized in the most efficient way across campaigns that have similar goals. This allows you to maximize performance and ROI towards your goals." - Google Ads Help
- Combine campaigns with similar objectives under one shared budget.
- Check performance daily to identify any allocation issues.
- Keep part of your budget available for unexpected opportunities.
- Adjust allocations based on how each campaign performs.
Conclusion
Cutting Google Ads costs while keeping sales steady requires a smart, data-focused strategy that enhances ad relevance and quality. Advertisers who prioritize targeted campaigns, carefully chosen keywords, and matching landing pages often experience lower CPCs and consistent conversion rates.
Here’s a great example of this approach in action:
"By analyzing the CAC per marketing channel, we can identify which channels are delivering the best ROI and which ones may need to be optimized or discontinued. This allows us to allocate our marketing budget more effectively and maximize our ROI." - Adam Binder, Founder & CEO, Creative Click Media
Inflow demonstrated this with a client, increasing PPC revenue by 76% through Performance Max campaigns. This shows how smart adjustments can reduce costs while driving results.
To maintain success, consider these practices:
- Track performance daily: Keep an eye on metrics like conversion rates and CPA to measure effectiveness.
- Experiment with ads and bids: Test different ad variations and bidding methods to find the most efficient strategy.
- Be flexible: Adapt your approach based on market trends and competitor actions to stay ahead.
"We monitor Google Ads performance on a daily basis, focusing on the clients' KPIs. Usually, within our pool of clients, this is conversions and/or cost per conversion. Ultimately, the key is to test different strategies and adapt based on performance, regardless of the budget size."
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