Google Ads. Benchmarks: 2016 vs. 2018

Transcription

1 Google Ads Benchmarks: 2016 vs. 2018

2 You asked, we delivered our Google Ads benchmarks for top search and display advertising KPI s (click-through rate, cost per click, conversion rate, and cost per acquisition) are one of our most popular resources of all time, and we recently updated those benchmarks with fresh 2018 data. But many of our readers also wanted to see exactly how each of those averages had changed in the two years since we released our original study. That s what you ll find in this guide: a direct comparison of each figure, plus analysis from our Senior Data Scientist Mark Irvine on what it all means. Let s dig in! GOOGLE ADS BENCHMARKS: 2016 vs

3 Average Click-Through Rate (CTR) How have click-through rates changed since 2016? GOOGLE ADS BENCHMARKS: 2016 vs

4 On the search network... Nearly across the board, click-through rates on the SERP are way up! It s no doubt that the introduction of larger ads on the SERP (aka Expanded Text Ads) and the loss of typically low-performing ads on the right-hand side of the SERP explain a lot of this growth. New ad extension types also help raise average CTR. The industry with the largest growth is nonprofits and advocacy. Of course, a lot of this increase is intentional given that Google announced earlier this year that advertisers who wanted to maintain their Google Grants had to maintain a 5% minimum CTR. Many are finding this challenging! GOOGLE ADS BENCHMARKS: 2016 vs

5 On the search network (cont)... Big-ticket items Travel, Auto, and Real Estate have also seen larger than average growth over the past few years. It s common that these items require a user to research more (and perform multiple searches) before ultimately making a purchase, so recent improvements in RLSA, demographic targeting, and ad customizers benefit these clients the most. Only a handful of industries have not seen CTR increase over the years most notably Technology. As news about technology spreads faster to the mainstream, it s becoming increasingly important to preventatively add negative keywords to dissuade clicks from an audience that may be searching for your keywords for purely informational reasons, and with no intent to buy. GOOGLE ADS BENCHMARKS: 2016 vs

6 On the display network... Less than a decade ago, we considered a 0.1% CTR on the display network as good. Today, the average CTR for display ads is more than four times as high! Nearly every industry is seeing significant improvements to their display ad CTRs. Between new, easy to create ad formats and better ad targeting for the display network, there s a lot to be excited about. Real estate advertisers have the most to be excited about boasting the highest CTRs and the biggest gains in recent years. Technology advertisers, again, are the exception here. If you re running remarketing campaigns remember that they ll only perform as well as your audience. If you ve got poor traffic coming in via a trending search term that s not related to your product, your remarketing ads will similarly suffer! GOOGLE ADS BENCHMARKS: 2016 vs

7 Average Cost Per Click (CPC) How has cost per click changed over the years? GOOGLE ADS BENCHMARKS: 2016 vs

8 On the search network... People often claim that CPCs are always rising, but that s not universally true. Google often cites figures that CPCs are even declining in some industries year over year as more searches occur. Our data shows that to be true in some spaces. A lot of the cheapest clicks are on mobile devices advertisers who don t take advantage of this cheap mobile traffic are bound to see much larger increases in their average CPC. In particular, Technology and B2B clients are most skeptical to this traffic and pay a hefty price for it. GOOGLE ADS BENCHMARKS: 2016 vs

9 On the search network (cont)... Legal advertisers might not see the largest changes in their accounts, but they continue to break records with the highest CPCs in the industry! Dating & Personal ads was an industry waiting to explode in 2016 with few competitors, high CTRs, and low CPCs, they had it all. That honeymoon may have ended. CPCs have increased over 1300%, and finding a good match on the SERP costs more than many other services. GOOGLE ADS BENCHMARKS: 2016 vs

10 On the display network... The secret of display ads is out nearly all advertisers are paying more for their display ads than they did two years ago. (Display is, however, still much less costly than search advertising for every industry.) Even with a 55% increase in average CPC, ecommerce clients still see the cheapest clicks from display ads, with an average under $0.50 per click. There are some exceptions to that rule in particular, employment services. In industries where social advertising has become more successful, we re seeing display ad CPCs fall significantly. GOOGLE ADS BENCHMARKS: 2016 vs

11 Average Conversion Rate How have conversion rates changed since 2016? GOOGLE ADS BENCHMARKS: 2016 vs

12 On the search network... Conversion rate optimization, or CRO, is a big task for many small businesses but putting in the effort pays off big dividends. As we see, most industries have improved their conversion rates in the past few years. However, not all CRO looks the same industries that can take advantage of different ways to attract their customers with call-only campaigns or more ad extensions are seeing the biggest bumps on the SERP. Nearly every good lawyer knows the benefit of call-only campaigns, and it shows in their surging CVR numbers. GOOGLE ADS BENCHMARKS: 2016 vs

13 On the search network (cont)... Ecommerce clients often have their campaigns torn between multiple kinds of campaigns branded search, shopping, products and it s tough to be successful on the SERP with just one type of campaign. We ve seen that advertisers who manage more campaigns often see the biggest improvements in their overall marketing goals. Financial industries used to have the highest conversion rates on the SERP. While they still perform well, they re losing their edge. Having one of the highest CPCs, they can t afford to lose ground. If you need help in this area, check out our best tips for improving ad campaigns in the finance industry. GOOGLE ADS BENCHMARKS: 2016 vs

14 On the display network... Most industries have seen slight increases in their conversion rates on the display network, but the landscape does not look wildly different than it did a few years ago. Although remarketing hasn t changed much in recent years, it s become increasingly popular. And for good reason many industries are finding more success with remarketing as searchers take longer to consider their purchases online. If you re not seeing improvements to your remarketing campaigns, consider testing different offers and calls to action. It can be tough to make a display ad with an attractive B2B, Education, or Healthcare GOOGLE ADS BENCHMARKS: 2016 vs

15 On the display network (cont)... offer but creative offers can reengage your customers on these networks. Your display ads might need a different call to action or offer than your search ads, given that your customers aren t actively searching for you in the moment they see your display ads. To see the biggest improvements in your display and remarketing efforts, advertise across multiple platforms! We see advertisers that use search, display, Bing, and Facebook ads have larger remarketing lists and benefit the most from cross-network effects. GOOGLE ADS BENCHMARKS: 2016 vs

16 Average Cost per Acquisition (CPA) How has cost per acquisition changed over the years? GOOGLE ADS BENCHMARKS: 2016 vs

17 On the search network... Some industries have seen CPA go up in the past couple of years, but others are roughly flat (ecommerce, home goods) and others have seen a substantial decrease in CPA (autos, employment services, health and medical, legal). Remember: CPA is a measure of efficiency, not of profitability! A lower CPA might not help you if you re losing potential customers because of your frugality. Align your CPA goals with what makes your campaigns the most profit. GOOGLE ADS BENCHMARKS: 2016 vs

18 On the search network (cont)... As real estate prices continue to rise and housing markets get more cutthroat, we re seeing many real estate clients are willing to pay more than twice per lead compared to two years ago. However, as customers become more connected and can price-shop more than ever, many industries like Auto and Travel have lowered their CPA goals to keep themselves competitive. GOOGLE ADS BENCHMARKS: 2016 vs

19 On the display network... The growth of display ads has enabled more advertisers to get more leads at the compromise of paying more for each lead. But again, some industries have seen falling CPA s on display just as they have in search including auto, employment services, industrial services, and legal. As tuition prices rise, many educational clients are understanding the value of branding and often use their display campaigns to guide more potential students in at earlier stages of their research. GOOGLE ADS BENCHMARKS: 2016 vs

20 Data Sources: This report is based on a sample of 14,197 US-based WordStream client accounts in all verticals (representing over $200 million in aggregate AdWords spend) who were advertising on Google Ads Search and Display networks between August 2017 and January Each industry includes at minimum 30 unique active clients. Averages are technically median figures to account for outliers. All currency values are posted in USD. GOOGLE ADS BENCHMARKS: 2016 vs