Marketing is a crucial arm of any business as it helps make your name known to others and attract customers, who will ultimately grow your bottom line. Nowadays, digital marketing is a must as it allows you to build an online presence, which opens up doors of opportunities to reach new customers. If you are engaged in e-commerce, hiring a Google Shopping Management Company will be extremely helpful since their services can maximize your returns and ensure that your advertising expenses are allocated correctly.
With tons of marketing strategies to choose from today, it is important to know which ones will work for your business. Naturally, you do not have unlimited financial resources to fund every possible strategy, so you must allocate a budget for each aspect of your marketing plan. Google Shopping can be a welcome addition for online businesses since it helps you advertise your products to buyers with purchase intent.
If you want to leverage on Google Shopping ads to attract more shoppers and drive your online sales, you can invest in services from a Google Shopping Management Company. However, you may be wondering: How much budget should be allocated for this? Naturally, the exact price will vary based on what you need, but here are some of the common costs to help you estimate your budget.
Google Shopping Cost
First, it is important to understand the cost of listing your products in Google Shopping. One of the main benefits of using the platform is the flexibility in pricing as you are not required to spend a minimum amount daily. You can adjust your daily budget as you see fit, but naturally, a lower budget will mean limited visibility.
Given the flexibility offered by the platform, you can also decide on the cost per click (CPC) to determine how much your ads can be served. Fortunately, statistics show that the costs per click for Google Shopping ads are lower than their search keywords, so you can expect less spending. The average CPC is at about $0.66, with the highest being $1.09 for the Office & Business Needs category.
There is no direct method to calculate the exact daily budget to allocate for your ads. However, in doing this, you can consider the number of products you have, your financial capacity, and other factors. Based on market research, Google Shopping ads are observed to get about 60% of the clicks of search ads. Thus, you can set your Shopping ads budget to be at about 40-60% of your paid search budget.
Average Budget Benchmarks
With the average CPC being at $0.66, you can target a reasonably good number of people without spending too much. Even with as little as $10 for your daily budget, you can still get good traffic from shoppers. If you are still unsure of how much is considered reasonable for your Shopping ads and campaigns, you can check out how much other companies spend.
Benchmarks show that the Health & Beauty and Computer & Finance industries have the largest Google Shopping monthly ad budget at approximately $1,800 and $1,400, respectively. The lowest monthly budgets, on the other hand, come from the Travel & Luggage and Educational Supplies industry at a little below $300.
Based on the numbers above, you may notice that the industry you operate in may also affect your budget for Google Shopping. If you find the average to be too high, you can always set it at a lower price first to see how your ads perform.
Services Cost
Apart from the Google Shopping ads cost, you must also factor in the costs of services from a Google Shopping Management Company. This is much harder to estimate since it will depend on the rates from each company, so one way to estimate this is by getting quotes from multiple companies. Before you decide who to hire, take the time to ask about pricing to set expectations from the beginning.
Companies will always make sure to work around your budget when planning for your campaigns. However, you may be able to get different services at the same cost from each company, so taking the time to do research beforehand will be useful.
Much like other marketing strategies, Google Shopping ads and campaigns will incur expenses, making it important to set aside a budget for these. While the exact amount will vary significantly for each company, the industry benchmarks can give you a rough idea of how much you are likely to spend.