Why is Google AdWords so Expensive? 25 reasons

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Why is Google AdWords so Expensive? 25 reasons   

The cost implications of Google AdWords places many would be users out of contention. However, this should not be the case. With effort, dedication, and a pinpoint strategy, one can learn the ropes and utilize nifty workarounds to bring the cost down and optimally make use of Google as an advertising platform. Below are 25 reasons why AdWords is expensive.

High demand

With demand comes price increments. Considering the number of e-commerce websites mushrooming every day; it is not a wonder, then, that the Google’s PPC rates continue to increase.

Competition

In line with higher demand, competition for ad space has grown considerably which has brought about increased ad rates.

Inflation

The world economy, in general, has continually suffered inflation which has led to goods and services becoming more expensive; AdWords included.

AdWords efficacy

With proper utilization and strategizing, the simple truth is that Google AdWords works. As with anything that works well, expensiveness increases.

Concentration on a few keywords

Law and insurance oriented keywords have colossal interest leading to unnatural competition which results in CPC of winning bids reaching up to the $60 mark.

Googles reach

Google’s reach is phenomenal bar a few nations such as China. This makes it a very attractive advertising medium for many with the result being an increase in ad rates.

Traffic

With over 3.5 billion search queries per second, it is not a wonder that advertising on Google is costly.

Monopolistic market

Google has the lion’s share of the search market with close competitors being Bing and Yahoo. As such, the firm has the flexibility to drive ad charges upward without fear of losing clients.

Steep learning curve

AdWords has a steep learning curve that has cost implications regarding required training and time needed to acclimatize. The cumulative effect, therefore, becomes increased expenses but with experienced professionals like guttulus it becomes easier to manage.

Time consuming

In addition to being financially costly, many find AdWords campaigns to be expensive time-wise even though the results are often worth it.

AdWords campaigns are management intensive

Constant monitoring, tweaking and adjusting make Google AdWords management intensive which leads to an overall increase cost-wise.

Trial and error

To get a sweet spot that is ideal, some level of trial and error, which may cost money without providing good ROI, is usually needed. This directly results in increased costs.

Cost of creating good ads

For ads to show on Google, regardless of high bids, they have to be of premium quality – a cost that is transferred to the user in addition to the bid cost.

It is ever-changing

The fluidity of the online marketplace means that what is in-season one moment may be out of season the next moment. This high-risk environment means that AdWords efforts that are currently fruitful may suddenly fail, hence calling for fresh investments leading to increased costs.

Cost of maintenance

With extensive reach and size comes increased maintenance costs which Google has to finance through higher ad rates.

Account history

Google tends to charge brand new account users slightly higher. Also, accounts on Google’s naughty list are often slapped with penalties and increased rates.

Traffic increase in related segments

When one industry receives higher traffic, ad cost for related industries increases. If keyword traffic on ‘content research’ increases, for instance, it will have a knock-on effect on ‘content analysis software’ leading to increased ad rates in the related segment.

Lack of enough data

Google does not have all information relating to all sectors in all locations. As a solution, in such scenarios, global bids, which tend to be more expensive are enforced.

Rich multinationals joining AdWords

Behemoth multinationals can fork out more for particular keywords which drives up prices to levels other firms cannot afford.

Exploitation

Though largely unfounded, there have been rumors of Google increasing rates to make more money off advertisers.

The quality score

Many people have a quality score of below 7 which directly results in higher rates. Googles uses account quality score in a similar manner to how financial institutions use the credit score to give out loans.

Focusing on low competition keywords

Focusing on cheaper low-competition keywords leads to a catch-22 situation since such keywords usually reduce an account’s quality score leading to increased rates.

Mode of payment

The mode of payment, which is pay-per-click, tilts the playground in Google’s favor. This is because clicks do not necessarily result in conversions. Therefore, users may end up paying for valueless traffic.

Character regulations

Google has put in place character restrictions in ad formulation which make it hard for many to develop winning ads that justify PPC expenditure hence leading to lost revenues.

High cost of making mistakes

With Google AdWords, mistakes are costly. Forgetting to turn off ads, for instance, can blow through thousands of dollars.

The silver lining

Though expensive, with Google AdWords, there is a silver lining. The knowledge gained helps one to streamline other marketing channels such as Facebook marketing, Bing ads, etc., to maximize efficacy. To fast track AdWords mastery, consider getting professional help from seasoned professionals of which ppchire makes a part of.