Are Google Ads Worth It? Pros, Cons & Considerations

Google Ads have become a go-to marketing tool for businesses of all sizes to target their Ideal Customer Profile (ICP) and drive results. But is it truly worth the investment? The data tells a compelling story:

1. Over 80% of desktop searches happen on Google.
2. According to Google estimates, businesses earn an 800% ROI, making $8 for every $1 spent. 
3. Top-ranking search ads on the platform have an average click-through rate (CTR) of 6.64%, while conversion rates typically fall between 3% and 4%. 
4. With Google projected to generate over $340 billion in ad revenue by 2027, it’s clear that it's clear that businesses see real value in Google Ads to reach their target audience.

But is Google Ads the best strategy for your business? In this article, we’ll explore its pros and cons so you can decide if it deserves a spot in your marketing plan.

Also, check out our article on Google Ads for SaaS.

TL;DR

• Google Ads allows businesses to target specific audiences through tailored campaigns.
• Its pay-per-click (PPC) model is accessible for varying budgets, enabling higher conversions, especially with niche keywords.
• While Google Ads can deliver immediate visibility, achieving consistent sales-qualified leads requires ongoing management and optimization. 
• Understanding your specific objectives—whether for brand awareness or direct sales—is crucial in determining the platform's value. 
• When approached strategically, with clear goals and proper budget allocation, Google Ads can be a worthwhile investment for B2B companies. As digital advertising costs rise, an informed approach will help you decide if it fits your marketing strategy.

Pros and Cons of Google Ads

Pros of Google Ads

1. Google Rules the Search Engine Industry

Google Ads platform dominates the search engine industry. As of January 2024, Google holds a market share of 81.95% for desktop search engines. Nearly everyone relies on Google, and it doesn’t include the other parts of the Google ecosystem, like YouTube, which further expands your audience. 

This dominance provides a vast opportunity for your paid ad campaigns to reach potential customers effectively.

2. Target Users Based on Real-Time Search Intent

One of the most significant advantages of Google Ads is its ability to reach the right audience at the right time.

For example, you have a blog post about the best B2B visitor identification tools. That’s a niche topic, right? Google lets you zero in on the exact audience looking for that content. By creating an ad campaign around keywords like ‘B2B visitor identification tools,’ you can reach users who are already interested in what you offer.

With Google Ads, you’re not casting a wide net; instead, you’re reaching individuals who are actively searching for the solutions you provide.

3. Faster Results Than SEO

SEO campaigns take time to produce results, and frequent Google ranking updates can complicate your strategy. While SEO is essential for any business, gaining visibility in search results often takes weeks or even a few months. In contrast, paid search ads appear immediately.

The immediacy of Google Ads is one of its most appealing benefits, especially compared to the lengthy process of organic rankings. With the right bid and Quality Score, Google Ads can secure a top position in search results, helping you outpace competitors and reach your target audience faster.

To know more about how to secure top positions for your Google Search Ads, read our article on Google Ad Rank. 

4. Powerful Performance Tracking

Google Ads offers a robust, free tool packed with analytics to boost your marketing efforts.

The PPC (Pay-per-click) statistics show how your ads perform and suggest changes to improve your results. You can easily A/B test ad copy and landing pages to maximize ROI. Track metrics like average cost per click, ad position, and conversion rate to gain valuable insights. Quickly monitor click-through rate (CTR), cost per conversion (CPC), keyword search volume, ad quality score, and ranking.

You can also link your Google Ads account to Google Analytics to compare PPC and organic search data. This integration helps you allocate your marketing budget more effectively and provides solid data to back your decisions to the leadership.

Google Ads provides detailed insights into your audience, campaigns, and keywords, giving you ample opportunities for optimization. Its user-friendly interface makes it easy to navigate data and focus on what matters most.

5. Wide Range of Google Ads Format

Google Ads started with simple text-based ads but has evolved significantly since then. While many original features remain, the platform has many tools designed to attract and engage new customers.

Sitelinks, social proof, location targeting, ad extensions, and shopping ads for eCommerce can enhance your ads, allowing for exceptional customization and control over your advertising experience.

Although we often think of search ads when discussing Google Ads, the platform offers various ad formats that can be crucial to your marketing strategy. These are text ads, search ads, responsive ads, display ads, video ads, etc. You can also enhance your ads with rich, interactive elements like maps and high-resolution images for lesser bounce rate.

Regardless of your industry, Google Ads has features that can help make your products and services more appealing to your target audience.

6. Control Spending and Generate ROI

With Google Ads, you have complete control over key campaign parameters, including how much you're willing to spend per click. You can set a daily budget, and Google will distribute your spends throughout the month. While daily costs may vary, your total spending will always stay within your monthly limit. Even with a budget as low as $100 per month, Google Ads can work for your business.

Google’s auction model ensures you pay the lowest possible price for each click. Your cost per click is determined by the highest bid from the ad ranked below yours, plus one cent.

On average, pay-per-click (PPC) campaigns generate $2 for every $1 spent, making Google Ads an effective advertising tool.

Cons of Google Ads

1. Time-Consuming

Although Google has automated many tasks within its ad platform, you can’t just set up your campaigns and leave them running. To maximize your ad spend, you must actively manage and fine-tune your campaigns, especially in the early stages.

You must know how to work with the Ads interface, interpret the insights and improve performance. This includes revising your strategy based on new data, monitoring keyword performance, managing negative keywords to avoid wasted ad spend, and using the data from initial results to optimize and adjust. Ignoring these steps can quickly lead to wasted budget and underperformance.

While Google’s machine learning enhances automation, automatically applying Google’s recommendations isn’t always the best move; you must maintain control to ensure your campaigns align with your goals.

2. Some Keywords are Expensive

Paying the lowest price per click doesn’t guarantee that Google Ads are cheap. You’re bidding against competitors, and for specific high-value keywords, costs can quickly rise. As one of the top marketing channels, Google Ads is highly competitive, and the more marketers use it, the more expensive it becomes.

Below in this example, you can notice how the cost differs between the keywords ‘insurance’ and ‘marketing.’ The insurance industry is highly competitive, which leads to higher bids.

Google Ads is flexible and works with almost any budget, but digital ad prices are rising (13% year-over-year increase in cost-per-click). While poor optimization can waste your budget, the bigger challenge is keeping up with rising digital advertisement costs. With more marketers in the game, standing out is more challenging than ever. To cut through the competition, you need a strategic approach and a proper budget to back it up.

Are Google Ads Worth It for Small Businesses? What Should You Consider?

To determine if Google Ads is right for your business, consider the following questions:

1. What specific outcomes do you want Google Ads to deliver?
2. Is Google Ads a profitable investment for your business?
3. What are your marketing costs, and how will they affect your ad budget?

Answering these questions will help you decide whether Google Ads is a worthwhile investment for your B2B SaaS business.

Question 1: What Specific Outcomes Do You Want Google Ads To Deliver?

Firstly, you should understand what Google Ads can and cannot do. 

Google Ads cannot: 

• Guarantee sales or leads
• Ensure that generated leads will convert
• Steal customers from your competitors

However, Google Ads can help you achieve realistic goals like:

• Increasing visibility for your brand, products, or services
• Appearing when people search for your competitors
• Reaching potential clients through targeted ads
• Promoting your physical location to nearby prospects
• Driving website traffic to specific landing pages to increase engagement
• Building brand awareness through remarketing campaigns, which allow you to re-engage users who previously visited your website
• Generating actionable insights about your target audience through campaign performance data, helping you refine your overall marketing strategy

So, the first step is always setting up clear goals about what to achieve with Google Ads.

Question 2: Is Google Ads a Profitable Investment for Your Business?

Once you have set clear goals, determine how much ROI you’ll generate for every $1 spent. Factors like industry competition, cost-per-click, and website conversion rates also impact your results. Evaluate these factors to understand the profitability of your Google Ads campaigns.

Typically, businesses actively running ads on Google fall into any one of these categories:

1. Breakeven

When your Google Ads campaign hits breakeven, it means you’re covering your costs but not yet generating a profit. While this might seem like a neutral outcome, there are compelling reasons to dig deeper and evaluate whether it’s still a worthwhile investment. 

Consider additional factors like:

1.1 Brand Awareness

Even if you’re not making a profit now, Google Ads can boost your brand visibility. This awareness builds trust and recognition over time, influencing potential customers who might convert later.

For example, a break-even campaign might result in your ads being seen by thousands, planting the seed for future sales as your brand becomes more familiar.

1.2 Profit Margins

High profit margins mean you can afford to invest in customer acquisition without immediately seeing profits. On the other hand, if your margins are slim, a break-even point could strain your business financially.

For example, a product with a 60% margin can sustain more aggressive ad spending than one with a 10% margin at breakeven.

1.3 Repeat Customers

Acquiring customers who come back repeatedly turns a break-even scenario into a long-term win. A single purchase might cover costs, but additional purchases turn these customers into profitable assets.

For instance, if a break-even campaign attracts subscribers or customers with a high retention rate, the return on investment (ROI) grows over time.

1.4 Customer Lifetime Value (CLV)

CLV measures the total revenue a customer generates over their relationship with your business. If your Google Ads bring in high-CLV customers, you’re building a foundation for future profitability.

For example, if you spend $50 to acquire a customer and their CLV is $500, a breakeven point today might be a sign of long-term gains.

By carefully evaluating these factors, you can decide if a breakeven campaign is aligned with your business goals or if adjustments are necessary to improve profitability.

2. Unprofitable:

If you are losing money on Google Ads, then you are unprofitable running Google Ads. Immediately reassess your objectives.

2.1 Direct Sales vs. Brand Awareness

The purpose of your campaign directly influences how you measure success. If your focus is direct sales, profitability is immediate. For brand awareness, returns are long-term and harder to measure immediately.

For example, a campaign generating minimal direct sales may still be effective for increasing visibility and positioning your brand as a leader in your industry.

To summarize,

• for direct sales, analyze whether your ads align with the right audience and if the offer is compelling.
• for brand awareness, understand that consistency is key; results may only show over time, but they can contribute to customer loyalty and future sales.

2.2 Evaluating Audience Resonance

Ads that don’t resonate with your audience won’t convert, leading to wasted spending. Poor targeting, irrelevant messaging, or ineffective creatives can be the root of the problem.

For instance, an ad with a generic message might fail to attract attention, while one tailored to highlight a specific pain point can yield better engagement.

Then, how do you improve your ads to resonate better with your audience?

• Test different ad formats and messages through A/B testing.
• Use audience insights to refine targeting based on behavior, demographics, or interests.

2.3 Targeting Competitor Keywords

Targeting competitor keywords can be a high-cost strategy, often resulting in low ROI due to stiff competition. Established brands with bigger budgets can outbid smaller businesses, driving up cost-per-click (CPC) without guaranteeing conversions.

For example, a a small SaaS startup bidding on keywords like 'Salesforce CRM’ might lose out on Salesforce’s ads, wasting money without significant results.

What are the other measures you can take in this scenario?

• Bid for long-tail keywords. These are more specific and often have lower competition, meaning lower costs and more qualified leads.
• Focus on a specific audience that larger competitors often overlook.

3. Directly profitable

If your earnings from Google Ads exceed your spending, you've achieved a directly profitable campaign. Your advertising investment generates positive returns, contributing to your overall revenue.

4. Indirectly profitable

Indirect profitability can be harder to measure. However, you notice an impact on revenue when ads are paused or turned off. This indicates that your ads contribute to brand awareness and drive potential customers, even if you can't directly attribute conversions.

By considering these factors, determine if your Google Ads campaigns are profitable or not profitable. 

Question 3: What Are Your Marketing Costs, And How Will They Affect Your Ad Budget?

When considering Google Ads, account for the costs involved in setting up and managing your campaigns.

• If you run your Google Ads account yourself, your main costs will be time and the learning curve. The platform can be complex, and you risk wasting your budget without the right skills.
• Hiring an external expert can save you time but involves higher upfront costs.
• Hiring someone internally to manage your Google Ads can be beneficial if they can also handle other marketing tasks. This approach involves costs like salary, benefits, and an initial learning curve for optimal performance.

Evaluate these scenarios to determine which approach aligns best with your business needs and budget. By answering these three questions, you can determine if you can include Google Ads in your marketing strategy.

The Verdict: Are Google Ads Worth It?

Google Ads offer a compelling opportunity for B2B marketers to reach their targeted audience effectively. Overall, Google Ads can be worth it. 

They won't generate sales-qualified leads instantly. Achieving results takes time and effort, especially in the B2B space. Before diving in, invest time in understanding Google Ads management and best practices. A solid B2B Google Ads strategy, a well-defined budget, and ongoing optimization are essential for getting the most out of the platform. Carefully evaluate these factors to decide if Google Ads aligns with your marketing goals and budget.

Measure Your Google Ads ROI Better With Factors

Google Ads are worth it if it justifies the ROI. Segment insights by factors can significantly boost your Google Ads ROI by enabling targeted analysis and optimization. Here’s how:

1. Segment-Level Measurement: Focus on specific audience segments to track how they respond to ads. It allows you to eliminate irrelevant data and zero in on what matters for better targeting and budget efficiency.
2. Custom KPIs: Create custom metrics for each segment to assess campaign performance better. This will help you determine which segments are worth targeting and improve campaign focus.
3. Segment-Level Comparison: Compare different audience segments or perform A/B tests to see what resonates best. It enables data-driven adjustments to optimize your spend for higher ROI.
4. Lift Analysis: Use lift analysis to compare similar segments—one receiving ads and one not—to understand which strategies are most effective. This will allow better budget reallocation and improved returns.

FAQs on Google Ads

Is it worth investing in Google Ads?

Every business has unique needs. Investing in Google Ads can be worth every penny depending on the specific goals the company wants to achieve, the ad budget, and the company’s ad profitability model. 

Is Google Ads worth it with a small budget?

Yes, Google Ads can work efficiently even with a small budget, but this largely depends on the industry you are in. In a highly competitive industry, the CPC might be higher. In those cases, you should use an effective strategy that reduces the cost and gives you maximum returns on ad spending.

Is $100 enough for Google Ads?

It depends on your industry, average CPC, and ad network.