How much should I spend on Google Ads per month?

Google advertising is becoming a powerful tool for all types of businesses, from small to large. But the key question is: How much should i spend on google ads per month. This article by Rentads will help you answer that question in the most practical and data-driven way, so you can confidently invest in your advertising campaign.

Overview of Google Advertising Costs

The following content will help you understand common budget levels and the key factors that influence Google Ads.

Typical budget ranges in the market

In reality, Google Ads budgets vary widely depending on business scale and goals:

• Small businesses or new advertisers: Usually spend around 300–900 USD/month (approximately 7–21 million VND), which is enough for market testing and initial data collection.
• SMEs with some online presence: Spend between 1,000–3,000 USD/month (25–75 million VND), suitable for expanding Search, Display, and Remarketing campaigns.
• Medium-sized businesses: Budgets often rise to 7,000–30,000 USD/month (~175–750 million VND), allowing for multi-channel campaigns and larger-scale operations.
• Large enterprises or multi-industry businesses: Budgets can reach 20,000–50,000 USD/month or more (~500 million to 1.25 billion VND), enabling comprehensive campaigns across Search, Display, Video, and Shopping.

Costs increase in a well-defined pattern: The more you expand your budget, the more necessary it becomes, but you must allocate funds to the right target.

Key factors that affect your budget

• Competitive industry: Industries like insurance, law, real estate, and finance often have high CPCs, sometimes reaching 5–6 USD per click due to intense competition.
• Keywords used: Common and short keywords (e.g., “real estate”) are typically more expensive. On the other hand, long-tail or niche keywords (e.g., “2-bedroom apartment in Hanoi”) can significantly reduce your budget.
• Quality score (QS): A high QS lowers CPC and improves ad ranking. To achieve a good QS, ensure your ads are relevant, your landing page is high-quality, and your click-through rate (CTR) is strong.
• Target location: National targeting tends to cost more than local targeting. Focusing on a specific area helps reduce costs and improve efficiency.
• Ad network used: The Search Network usually has the highest CPC. The Display Network is more affordable but has a lower CTR. Video (YouTube) ads operate on a CPV basis and are best for brand awareness goals.
• Campaign objective: Campaigns focused on brand awareness use CPV or CPM, which generally cost less than conversion-based goals (CPA).

The formula for setting a starting budget for Google Ads

To set a starting budget for Google Ads, you can apply a simple formula as a baseline for a reasonable budget. Specifically:

Determine the budget based on CPA and conversion goals

• Define your target CPA: CPA = average industry CPC / conversion rate. Example: CPC ≈ 2 USD, CR ≈ 4% → CPA ≈ 2 / 0.04 = 50 USD.
• Set a target number of conversions: If you want 20 leads per month, your budget should be approximately 20 × 50 = 1,000 USD.
• Apply an adjustment ratio (e.g., multiply by 10): Use the Marlin multiple factor to compensate for uneven distribution. A recommended starting budget is 10 × target CPA.
• Divide by days: If a month has around 30 days, daily budget = total budget / 30. Google allows daily overspending, but it won’t exceed the total monthly budget.
• Test with a small budget and adjust: With a budget of 300–900 USD/month, you can run A/B tests, test ad groups, and keywords to select the elements that generate the best ROI.

Budgeting method based on revenue goal

If you aim for 50,000 USD in marketing revenue and expect a 200% ad ROI (spend 1 USD to earn 2 USD), you need to spend around 16,700 USD/month. By closely tracking real-time KPIs, you can adjust the budget and monitor revenue growth to stay on track, avoiding careless spending.

Define an optimal budget based on actual resources

Don’t follow trends blindly or spend heavily just because “big players do it.” Start with a budget that fits your actual capacity, test and optimize before scaling up.

How much should I spend on Google Ads per month?

When planning your monthly Google Ads budget, you should set an appropriate spending plan based on your business type and advertising goals.

Suggested budget by business type

• New businesses with limited capital and little advertising experience: 300–900 USD/month
• SMEs with a website or existing traffic: 1,000–3,000 USD/month
• Medium-sized businesses: 7,000–30,000 USD/month
• Large enterprises with multiple sectors: 20,000–50,000 USD/month

This is only a reference range. You should adjust based on specific objectives, industry, and test results.

Adjust your budget based on ROI performance

If ROI stays at ≥150–200%, you can gradually increase the budget.
If ROI is below 100% but traffic is growing, consider adjusting your strategy before increasing spend.

How to manage Google Ads budget effectively

The following methods help optimize spending and maintain stable campaign performance over time:

Monitor and optimize budget regularly

• Check your campaigns 1–2 times a week to ensure they don’t run out of budget early or go offline mid-month.
• Adjust bids, budget, schedule, and geographic targeting based on performance results.
• Quietly pause underperforming campaigns to reallocate budget to those with better ROI.

Use reports and automated alerts

• Enable email alerts when budget spending exceeds a set threshold (e.g., over 80%).
• Combine Google Ads and Google Analytics for deeper performance insights.

Optimize bidding strategy

• Start with manual CPC to maintain control.
• Once data is collected, switch to enhanced CPC, target CPA, or Maximize Conversions so Google can automatically prioritize conversions.

Apply negative keywords and audience filters

• Remove irrelevant keywords to save budget and improve your Quality Score.
• Set exclusion audiences to avoid spending on users who don’t need to be targeted.

Optimize landing pages and user experience

• Your landing page should load fast (under 3 seconds) and align with the ad content.
• Include a clear CTA, high-quality visuals, and keyword-relevant content.
• Improve mobile experience to reduce bounce rate and boost Quality Score.

Determining how much to spend on Google Ads should be based on your revenue goals, industry CPC, conversion rates, and desired ROI. Start with a reasonable budget, monitor closely, optimize frequently, and scale gradually as you gather positive performance data. Don’t focus on spending more—focus on spending smarter.

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