When does Google Ads charge you

Google Ads is an exceptional marketing tool that can help you get a competitive edge over others. However, many people are not sure about the amount they want to put in for their Google Ads campaign.

They are not sure about the payment threshold and how it works. To help you out, we will give you a brief idea of the payment threshold and how it works. Let’s get right into it.

Understanding The Payment Threshold In Google Ads

Let’s say you have added a card with a balance of £250 to your Google Ads account. The payment threshold is £50, so every time you cross that threshold, Google will bill your account. To clarify, every time you spend more than £50, Google will charge your card.

Therefore, a budget of £250 will be consumed after you use Google Ads five times. A critical takeaway is that there is no link between the billing threshold and the budget you set for your campaign. It is where many people get confused since they are not sure what amount they want to put in for their budget.  

So, if you want to spend £250 or £1000, it is up to you to decide depending on your needs. Let’s say you choose the budget of £250 for the entire month. If you spend £50 each day, it will dry up your budget after five days on the £50 payment threshold, and Google will charge you.

As you continue to put in more and more money, the payment threshold will continue to go higher to £500, £1000, £2000, £5000, and more. Simply put, the campaign budget does not have to do anything with the payment threshold since you can spend as little as you want.  

Essential Points To Keep In Mind

One of the vital things to note is that Google Ads does not bill you after the end of the calendar month. Instead, you will have to pay the bill after reaching your threshold, or once 30 days pass by.

Since the billing works on the payment threshold, you might find yourself getting charged more than once within the calendar month. So, if you are dealing with clients, you should inform them about this beforehand. It will help you avoid problems in the future.

Most importantly, it is best to inform your clients so that their credit card does not get declined. If the credit card does not work at any point, the threshold will automatically go back to £50. As a result, you will have to go through the entire process again, impacting your campaigns. 

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6 Min. Read

  1. Hub
  2. Marketing
  3. How Does Google AdWords Work? The Basics of Google Ads

March 28, 2019

When does Google Ads charge you

Google AdWords is a pay-per-click online advertising platform that allows advertisers to display their ads on Google’s search engine results page. Based on the keywords that want to target, businesses pay to get their advertisements ranked at the top of the search results page. Since the platform runs on pay-per-click (PPC) advertising, you have to pay only when a visitor clicks your ad.

The Google AdWords marketplaces work like an auction where people bid for clicks. However, it’s not necessary that the highest bid wins. Apart from money, Google also considers the quality score to ensure that the people clicking on the ads have the best possible experience.

What this article covers:

What Is Google AdWords?

How Do I Use AdWords?

How Does Google AdWords Charge?

Do Google Ads Really Work?

What Is Google AdWords?

Google AdWords is one of the largest online advertising platforms that helps businesses reach customers across the globe and grow their business. Through this pay-per-click network, advertisers pay Google to target users based on their keyword search, the country and device type and deliver their ads to users who are interested in their products or services.

Here’s what an ad may look like:

When does Google Ads charge you

Source: https://adespresso.com/blog/google-adwords/

What Are Google Ad Networks?

Google AdWords allows businesses to target users on two main networks – the search and the display network.

On the search network, advertisers bid on the relevant keywords. This gives them a display their advertisements to users who enter those keywords into Google as part of a search query. The paid search results are usually displayed on the top and bottom of the page have a small ad icon next to them.

The display network, on the other hand, offers advertisers the chance to display their banner advertisements on the websites that are a part of Google network.

What Is Ad Rank?

The Google AdWords system is principally a live auction where advertiser places a ‘bid’ in the AdWords system to secure a particular ad position. Depending on the competition and price bid by other advertisers, the advertiser either gets the desired position or related to a lower position.

Your actual ad position is, however, determined by two factors, your maximum bid multiplied by your quality score.

While maximum bid is how much you’re willing to pay when viewers click your ad, quality score refers to how well an ad is optimized, the quality of landing page, your expected click-through rate and the relevance of your ad to the searchers. The better your ad rank, the higher your ad is displayed in the google search results.

High-quality ads and well-performing AdWords campaigns are also rewarded by Google with discounted per-click costs, higher ad ranking positions and are more likely to show in top placement above organic listings.

How Do I Use AdWords?

To use Google AdWords, follow the steps below:

  1. Establish your account goals. For example, if you are using your Google Ads for brand building, the account structure and the features that you use will be completely different if you use ads for lead generation
  2. Develop audience personas by determining who your ideal customers are, what they do, what are they searching for and on what device
  3. Conduct keyword research by using keyword tools, such as SEMrush, to discover, cost, competition and volume for the search terms at every stage of your search
  4. Structure your AdWords account into different ad campaigns and ad groups, each featuring relevant keywords and ads
  5. Once you’ve listed the keywords relevant to your business, you can place your ads in the search results by bidding on the keywords. If the competition is high for the keywords, your Cost Per Click (CPC) would be too high to bid. In this case, it’s better to get granular and bid for long-tail keywords that are relevant for business
  6. Create the ad copy. Make sure that you include relevant keywords, a compelling headline, a clear call-to-action and ad extensions
  7. Design a mobile-friendly landing page that focuses on the benefits and features of the product or service that you’re trying to sell, has good-quality images, a form and a clear call-to-action
  8. Place a Google Analytics code on the website for conversion tracking
  9. The key to a successful ad campaign is routine optimization and A/B testing all your ad copies and landing pages

How Does Google AdWords Charge?

The amount that Google AdWords charges advertisers depends on what they are advertising.

Since Google AdWords is a pay-per-click advertising program, your ads are displayed for free and you’re charged only when someone clicks on your ad on Google search results page. Also, the AdWords system is a live auction, therefore, the click prices are determined by the amount of competition, and how much they’re willing to pay for a click.

When done correctly, Google AdWords can drive high-quality traffic to the website at costs that are much more competitive as compared to other forms of advertising.

However, when you don’t know how to expertly manage the process, costs can rack up fast while you potentially drive low-quality traffic. The key to running a successful AdWords campaign is to understand the factors that play into how much each click costs you.

  • Keyword competition
  • Maximum bid and bid position
  • Your average monthly budgets
  • Click-through rates
  • The quality score of your keywords

If you’re targeting high-volume keywords with lots of monthly searches, you could be paying a hefty amount for that traffic, which can be anywhere between a few cents to over ten dollars for each click.

To manage your AdWords costs, set a daily budget at the campaign level. You’re free to make changes to this when you like. Ideally, beginning advertisers should start small with a low budget. Based on the insights and the quality of leads, you can determine whether you want to boost your budget or stop a campaign.

Do Google Ads Really Work?

Google Ads can work for all types of businesses – big and small. It’s an affordable form of advertising that can target qualified, in-market prospects when managed correctly.

  • The key to making Google Ads work for you is to understand the ins and outs of paid search, bidding strategies, keyword research, account structure etc.
  • Map out what you’re able to spend on each campaign, set your daily budget accordingly and keep track of the spend
  • Do your keyword research and bid on the phrase and exact keywords at higher bids to get more relevant clicks
  • While creating ads make sure they are relevant and enticing enough for the viewer to click
  • Optimize your landing pages by running A/B tests to try out variations of a page
  • Try remarketing to reinforce your brand

If you’re still wondering if Google AdWords is worth the money, it’s best to start small, adjust based on results, and double down if your campaigns are generating affordable and profitable sales.


RELATED ARTICLES

Does Google Ads charge right away?

Automatic payments: You're automatically charged after your ads run, either 30 days after your last automatic charge or when you reach a preset amount (known as your threshold), whichever comes first. You can also make payments at any time to control your costs.

Does Google Ads charge daily or monthly?

Currently, you can't set a monthly budget within Google Ads. However, you can use your average daily budget multiplied by the number of days in the month to determine what your monthly spend will be.

What happens if you dont pay Google Ads?

What happens if you don't pay Google Ads? In the event of nonpayment, your account will be suspended. In addition, your credit card information and your personal contact information will be flagged; unless you pay Google, you won't be able to add new Ads accounts or access any paid services.

Does Google Ads charge for impressions or clicks?

So Ads are shown (impressions) free on a rotating basis against keywords (what advertiser predicts in the Google AdWords platform). Gradually some correlation between a particular keyword or phrase and click on an ad is established by Google. You pay only for clicks and not for the impressions.