Benchmarks: 2016 vs. 2018Google Ads

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You asked, we delivered – our Google Ads benchmarks for top search and display advertising KPI’s (click-through rate,

cost per click, conversion rate, and cost per acquisition) are one of our most popular resources of all time, and we recently

updated those benchmarks with fresh 2018 data. But many of our readers also wanted to see exactly how each of those

averages had changed in the two years since we released our original study. That’s what you’ll find in this guide: a direct

comparison of each figure, plus analysis from our Senior Data Scientist Mark Irvine on what it all means. Let’s dig in!

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Average Click-Through Rate (CTR)How have click-through

rates changed since 2016?

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• Nearly across the board, click-through rates on the SERP are way

up! It’s no doubt that the introduction of larger ads on the SERP (aka

Expanded Text Ads) and the loss of typically low-performing ads on

the right-hand side of the SERP explain a lot of this growth. New ad

extension types also help raise average CTR.

On the search network ...• The industry with the largest growth is nonprofits and advocacy.

Of course, a lot of this increase is intentional – given that Google announced earlier this year that advertisers who wanted to

maintain their Google Grants had to maintain a 5% minimum CTR.

Many are finding this challenging!

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• Big-ticket items – Travel, Auto, and Real Estate – have also seen larger

than average growth over the past few years. It’s common that these

items require a user to research more (and perform multiple searches)

before ultimately making a purchase, so recent improvements in

RLSA, demographic targeting, and ad customizers benefit these clients

the most.

On the search network (cont) ...• Only a handful of industries have not seen CTR increase over the

years – most notably Technology. As news about technology spreads

faster to the mainstream, it’s becoming increasingly important

to preventatively add negative keywords to dissuade clicks from

an audience that may be searching for your keywords for purely

informational reasons, and with no intent to buy.

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• Less than a decade ago, we considered a 0.1% CTR on the display

network as “good.” Today, the average CTR for display ads is more

than four times as high!

• Nearly every industry is seeing significant improvements to their

display ad CTRs. Between new, easy to create ad formats and better

ad targeting for the display network, there’s a lot to be excited about.

• Real estate advertisers have the most to be excited about – boasting

the highest CTRs and the biggest gains in recent years.

• Technology advertisers, again, are the exception here. If you’re running

remarketing campaigns – remember that they’ll only perform as well

as your audience. If you’ve got poor traffic coming in via a trending

search term that’s not related to your product, your remarketing ads

will similarly suffer!

On the display network ...

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Average Cost Per Click (CPC)

How has cost per click changed over the years?

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• People often claim that CPCs are always rising, but that’s not

universally true. Google often cites figures that CPCs are even

declining in some industries year over year as more searches occur.

Our data shows that to be true in some spaces.

On the search network ...• A lot of the cheapest clicks are on mobile devices – advertisers who

don’t take advantage of this cheap mobile traffic are bound to see much

larger increases in their average CPC. In particular, Technology and

B2B clients are most skeptical to this traffic and pay a hefty price for it.

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On the search network (cont) ...• Legal advertisers might not see the largest changes in their accounts,

but they continue to break records with the highest CPCs in the industry!

• Dating & Personal ads was an industry waiting to explode in 2016 –

with few competitors, high CTRs, and low CPCs, they had it all. That

honeymoon may have ended. CPCs have increased over 1300%, and

finding a good match on the SERP costs more than many

other services.

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• The secret of display ads is out – nearly all advertisers are paying more

for their display ads than they did two years ago. (Display is, however,

still much less costly than search advertising for every industry.)

• There are some exceptions to that rule – in particular, employment

services. In industries where social advertising has become more

successful, we’re seeing display ad CPCs fall significantly.

On the display network ...• Even with a 55% increase in average CPC, ecommerce clients still see

the cheapest clicks from display ads, with an average under $0.50

per click.

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Average Conversion Rate

How have conversion rates changed since 2016?

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• Conversion rate optimization, or CRO, is a big task for many small

businesses – but putting in the effort pays off big dividends. As we see,

most industries have improved their conversion rates in the past

few years.

• However, not all CRO looks the same – industries that can take

advantage of different ways to attract their customers with call-only campaigns or more ad extensions are seeing the biggest bumps on

the SERP. Nearly every good lawyer knows the benefit of call-only

campaigns, and it shows in their surging CVR numbers.

On the search network ...

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• Financial industries used to have the highest conversion rates on

the SERP. While they still perform well, they’re losing their edge.

Having one of the highest CPCs, they can’t afford to lose ground. If

you need help in this area, check out our best tips for improving ad campaigns in the finance industry.

On the search network (cont) ...• Ecommerce clients often have their campaigns torn between multiple

kinds of campaigns – branded search, shopping, products – and it’s

tough to be successful on the SERP with just one type of campaign.

We’ve seen that advertisers who manage more campaigns often see

the biggest improvements in their overall marketing goals.

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• Most industries have seen slight increases in their conversion rates on

the display network, but the landscape does not look wildly different

than it did a few years ago.

• Although remarketing hasn’t changed much in recent years, it’s

become increasingly popular. And for good reason – many industries

are finding more success with remarketing as searchers take longer to

consider their purchases online.

• If you’re not seeing improvements to your remarketing campaigns,

consider testing different offers and calls to action. It can be tough to

make a display ad with an attractive B2B, Education, or Healthcare

On the display network ...

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• To see the biggest improvements in your display and remarketing

efforts, advertise across multiple platforms! We see advertisers that

use search, display, Bing, and Facebook ads have larger remarketing

lists and benefit the most from cross-network effects.

On the display network (cont) ...offer – but creative offers can reengage your customers on these

networks. Your display ads might need a different call to action or

offer than your search ads, given that your customers aren’t actively

searching for you in the moment they see your display ads.

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Average Cost per Acquisition (CPA)How has cost per acquisition changed

over the years?

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• Some industries have seen CPA go up in the past couple of years, but

others are roughly flat (ecommerce, home goods) and others have seen

a substantial decrease in CPA (autos, employment services, health and

medical, legal).

On the search network ...• Remember: CPA is a measure of efficiency, not of profitability! A lower

CPA might not help you if you’re losing potential customers because of

your frugality. Align your CPA goals with what makes your campaigns

the most profit.

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• As real estate prices continue to rise and housing markets get more

cutthroat, we’re seeing many real estate clients are willing to pay

more than twice per lead compared to two years ago.

On the search network (cont) ...• However, as customers become more connected and can price-shop

more than ever, many industries like Auto and Travel have lowered

their CPA goals to keep themselves competitive.

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• The growth of display ads has enabled more advertisers to get more

leads at the compromise of paying more for each lead.

• But again, some industries have seen falling CPA’s on display just as

they have in search – including auto, employment services, industrial

services, and legal.

• As tuition prices rise, many educational clients are understanding the

value of branding and often use their display campaigns to guide more

potential students in at earlier stages of their research.

On the display network ...

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Data Sources:

This report is based on a sample of 14,197 US-based WordStream client accounts in all verticals (representing

over $200 million in aggregate AdWords spend) who were advertising on Google Ads’ Search and Display networks

between August 2017 and January 2018. Each industry includes at minimum 30 unique active clients. “Averages”

are technically median figures to account for outliers. All currency values are posted in USD.