The Anatomy of Online Advertising Costs in 2024
February 5, 2024
Online advertising is a brilliant way to find new customers, encourage existing shoppers to come back to your website, and make people aware of your brand. However, advertising on Google, Bing, and social media platforms like Facebook and TikTok comes with a cost, which you need to factor into your marketing budget.
So, as we move into 2024, how much is the cost of internet advertising? Let’s take a look.
How much does it cost to advertise on Google Search Ads?
Let’s start our investigation into average online advertising costs by checking out Google Search Ads.
Google Ads is one of the most popular advertising platforms around. This means there’s a lot of competition, which can push up your advertising costs. For the majority of industries, cost per click (CPC) is increasing year-on-year, with CPC jumping 5% from 2022 to the end of 2023.
The Average CPC in Google Ads is $4.22, but this can vary depending on the industry you’re in. Legal and realtor services are generally more expensive to promote.
How much does it cost to advertise on Google Shopping?
Google Shopping ads are more niche than Google search ads, as not all businesses can use them. As a result, the cost of advertising is much lower.
According to WordStream, the average cost per click for Google Shopping is $0.66, but like Google Search ads, some industries have lower CPCs than others.
How much does it cost to advertise on the Google Display Network?
Google Display Ads are generally less costly than Google Search Ads. This is because their primary aim is to raise awareness (top of the funnel) rather than encourage conversions (bottom of the funnel).
According to WordStream, the average cost per click for a Google Display ad is $0.63.
How much does it cost to advertise on Microsoft Ads (Bing)?
Fewer people use Bing than Google – while Google has a 92% market share, Bing only has 3%. As a result, there is less competition on Bing, meaning it’s cheaper to advertise.
The average CPC on Bing is $1.54, which is 63% less expensive than Google Search ads.
Microsoft Advertising also has its own shopping and display advertising networks. These could be worth investigating if you’re looking into cost-effective alternatives to Google Ads.
How much does it cost to advertise on Reddit?
If you want to serve highly targeted ads to engaged customers, Reddit Ads could very well be your secret weapon.
The interesting thing about Reddit Ads is that how you pay depends on the ad you use and your overall goal. So for example, brand awareness ads are calculated on a cost per mille (CPM) basis, while conversions are paid for by click.
(By CPM, we mean how much it costs to show 1,000 ad impressions to customers.)
According to Ad Spyder, the average CPC for Reddit Ads is $0.44.
How much does it cost to advertise on Facebook?
So, what about the cost of advertising on social media? Let’s start with Facebook, the most well-used platform of them all.
The average CPC for advertising on Facebook is currently $0.50, but again, the final cost will depend on your industry, the type of ad you use, and your campaign objective.
For example, in our experience, lead generation campaigns are more expensive than ads that drive traffic and conversions.
How much does it cost to advertise on Instagram?
With the option of promoting images and videos, Instagram is a fantastic option for businesses wanting to increase brand visibility and boost engagement.
But what’s the cost of advertising on Instagram? The average CPC is currently $1.03.
Why is advertising on Instagram more expensive than Facebook, given that they’re both owned by the same company?
As Instagram prioritizes promoting visual content, it’s in high demand by lifestyle brands, with the competition pushing up prices.
Of course though, the final cost will depend on several factors.
How much does it cost to advertise on LinkedIn?
If you operate in the B2C sector, LinkedIn ads might not be right for you. However, this social media platform is a fantastic choice if you work in B2B and want to target new customers.
According to Seer Interactive, the average CPC on LinkedIn is $5.39. This might sound extremely high compared to other social media platforms, but it’s important to remember that people sell a lot of high-value products on LinkedIn.
If you’re selling a CRM platform worth $30,000, you’re going to get a fantastic return on ad spend (ROAS) on that $5.39!
How much does it cost to advertise on TikTok?
One of the newer platforms when it comes to online advertising, TikTok is highly popular with younger audiences.
According to Varos, the average CPM on TikTok is $9.16. Bear in mind, though that TikTok is currently making many changes to how people advertise on the platform, so this cost may fluctuate over time.
How much does it cost to advertise on Pinterest?
Despite being one of the smaller social media platforms, Pinterest is highly popular with the fitness, travel, DIY, and fashion industries.
According to Web FX, the average CPC on Pinterest is $0.10, while the average CPM can cost up to $1.50.
Other online advertising costs you need to consider
While it’s important to know what your average cost per click will be on the advertising platforms you use, there are other advertising costs you need to consider, including:
- Optimization software (for example, Optmyzr, AdEspresso, SpyFu)
- Any agency or consultancy management fees
- Costs for creating assets and ad copy.
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Get StartedOur top tips for reducing the cost of advertising online
It’s important to remember that the online advertising costs we’ve mentioned above are guidelines. Your own advertising costs can vary depending on the industry you’re in, the number of competitors you have, and the types of ads you run.
However, the more affordable your campaigns are, the better! Here are some of our expert tips for keeping your online advertising costs low:
Identify your target audience
By knowing your target audience inside-out, you’re in a better position to create ads that resonate with their needs.
Use negative keywords
If you use search engine based ads, implementing negative keywords means people who aren’t in your target audience have less chance of seeing your adverts.
This means more targeted ads, a better chance of conversions, and a lower cost per click.
Make sure your website is well-optimized
A solid landing page can lead to a higher quality score/relevance score on platforms like Google Ads, Facebook, and LinkedIn. This in turn, can lower your advertising costs.
On Google Ads, an increase in quality score from 5 to 10 can mean a 50% lower CPC.
Avoid automated bidding strategies
While automated bidding is excellent for businesses that are short on time, manual bidding gives you a lot more control over your ad spend.
If you do opt to use automated bidding, regularly check your ad accounts to make sure you’re getting the best value for money.
Use A/B testing to see which adverts have the lowest cost
A/B testing, or split testing, is the process of running two similar ads with one key difference. This allows you to see which change leads to the most affordable ad.
Many platforms offer A/B testing as standard, making it easy to run multiple experiments at any one time.
Changing the image, call to action, or headline of an ad can make a significant difference!
Target your ads efficiently
Most online platforms let you target different demographics, meaning you can effectively lower your online advertising costs.
We did this for Yojee to reduce their spend on Google Ads. Our team analyzed when prospective customers were most likely to be online and adjusted Yojee’s ad bids accordingly.
Try different advertising platforms and placements
Many marketers automatically gravitate to Google Ads as a lot of people use it.
However, trying another platform that your target audience frequently uses can lead to lower costs without compromising on high-quality traffic.
Alternatively, try different ad placements within the same platform. For example, if you’re used to ads in the Instagram feed, give Stories or Reels a go instead.
Carry out online advertising audits
Paid advertising platforms evolve all the time, and a regular audit can make sure you’re on top of the latest changes.
We recommend carrying out a PPC audit at least every quarter or when the way you operate significantly changes.
Takeaways
Lower your online advertising costs with Aimers
If you want to make 2024 the year you lower your advertising costs for good, our expert team is here to help. We specialize in paid social and paid search at Aimers.
This means we can optimize your accounts, create ads that lead to high conversion rates, and maintain your accounts so you always keep bringing in new customers.
Whether you’re looking for a one-off audit or a long-term partnership, we’re here to support your business growth.
Contact us today and take the first step towards lowering your online advertising costs in 2024.
Denis shares strategic expertise and forward-thinking approaches on driving brand growth and optimizing marketing efforts, leveraging his extensive experience.