Setting Your Budget

Determining your budget and bidding strategy is crucial when running ads on Google. Your campaign budget sets a daily spending limit and should align with the amount you are comfortable spending daily. However, your actual expenses may vary depending on how you manage your bids.

Google Ads calculates budgets daily. To estimate your monthly budget, multiply your daily budget by 30.4 (the average number of days in a month). You can monitor your monthly spending limit and projections through the ‘Budget Report’ in your account.

Managing Your Bids

Your maximum cost-per-click (CPC) bid is the highest amount you’re willing to pay for a single click on your ad. Effective bid management allows you to control the traffic volume and ROI your ads generate:

Higher Bids: Attract more traffic but often lead to increased costs.

Lower Bids: Result in fewer clicks and conversions but may reduce expenses.

Average Daily Budget

The average daily budget represents the amount you’re comfortable spending on a campaign each day over the course of a month. You can adjust this budget at any time to align with your goals. Google’s optimization system takes advantage of peak periods, such as times of higher search traffic or increased ROI potential, to maximize results. 

As a result:

• Some days may use less of your budget.

• Other days may slightly exceed your daily budget.

Despite these fluctuations, Google ensures you won’t exceed:

Daily Spending Cap: Typically two times your average daily budget on any given day.

Monthly Spending Cap: Generally 30.4 times your average daily budget within a month.

Shared Budgets

For clients with multiple campaigns, Google Ads offers shared budgets. A shared budget allocates a total spending limit across multiple campaigns, making it easier to manage campaigns with a common goal.

For example, you could use a shared budget for seasonal campaigns targeting specific events like New Year’s Eve or Valentine’s Day. This strategy allows you to control spending across all relevant campaigns effectively.

Shared budgets can be managed in the Shared Library within your Google Ads account. However, they are not compatible with campaigns in a campaign group or those involved in an experiment.

Conclusion

Google Ads provides flexibility for businesses of all sizes. You can start with a modest budget and increase it as your campaigns deliver positive results. In general, higher investment levels can lead to greater returns. However, it’s essential to test and refine strategies to determine what works best for your specific business goals.

There’s no universal budget for Google Ads. Your ideal budget depends on factors such as your industry, competition level, available funds, and key performance indicators (KPIs). 

Begin with a budget that aligns with your comfort level, and adjust as you gain insights into your campaign’s performance.