Google Ads can drive growth, but understanding how much to invest is crucial. A good monthly budget typically falls between $1,000 and $10,000 for most small businesses. However, the right amount depends on several factors, including your industry, goals, and market competitiveness.
How to Decide Your Google Ads Budget
1. Know Your Industry
Competitive industries like legal services or finance have higher costs per click. A law firm might spend $100+ per click, while a local coffee shop might pay under $2. Research your industry benchmarks to set realistic expectations by using Google's Keyword Planner.
2. Define Your Business Goals
Your budget should align with your goals:
- Brand Awareness: Requires broader targeting and higher spending.
- Lead Generation: Focuses on measurable actions like form submissions or calls.
- Direct Sales: Prioritizes a strong return on ad spend (ROAS).
3. Understand Your Target Audience
Larger or highly specific audiences cost more. If you’re targeting a small, local area, you may need less budget compared to targeting a national audience. I would always recommend starting with a smaller radius to really dial in the optimization of the ads and then expand out from there.
4. Consider Your Experience Level
If you’re new to Google Ads, start small - around $1,000-$5,000 per month. As you learn to optimize campaigns, you can increase your investment to achieve better results. You want to make sure you're able to optimize your ads without being "Limited By Budget" too early in any given business day.
Budget Recommendations by Business Size
| Business Size | Recommended Monthly Budget |
| Small Businesses | $1,000 - $10,000 |
| Mid-Size Businesses | $7,000 - $30,000 |
| Enterprise Businesses | $20,000 - $50,000+ |
How Torro Media Can Help with Google Ads?
Deciding on a budget is just the start. The real success comes from proper management, optimization, and strategy. At Torro Media, we help businesses maximize their Google Ads investment by:
- Identifying cost-effective keywords.
- Fine-tuning ad copy for better conversions.
- Reducing wasted spend through data-driven targeting.
Whether you’re starting small or managing a six-figure campaign, we’ll help you get the best return on your investment.
If you want to calculate your own return, check out our Google Ads Calculator!
FAQs About Google Ads Budgets
What happens if my budget is too low?
If your Google Ads budget is too low, your ads may not show often enough, limiting visibility and making it tough to compete in high-cost industries. However, for local businesses or less competitive markets, even a smaller budget can still deliver meaningful results.
How do I calculate my Google Ads budget?
To calculate your Google Ads budget, start by setting your revenue goals. If your target return on ad spend (ROAS) is 3:1, allocate about one-third of your desired revenue toward ad spend.
To simplify the process, try Torro’s free Google Ads Budget Calculator. It helps you estimate the right budget based on your goals and industry benchmarks, so you can plan smarter and invest confidently.
Can I change my budget later?
Yes, you can change your Google Ads budget anytime. Start with a smaller budget, monitor performance, and adjust as your campaign results guide you. This flexibility helps you optimize spending
Conclusion
Investing in Google Ads is about balance. You want to find the right budget so you're spending enough to achieve your goals without overspending. If you’re ready to grow your business and need help managing your campaigns, Torro Media is here to guide you every step of the way. Fill out a quote form and we'll start running the numbers for your new campaign!
