Rob Timmermann

PPC Costs & Management: What to Expect and How to Maximize Your Ad Budget

Tired of conference room discussions, scratching your head over questions like, “Have we done enough to reach buyers?” “How can we improve our conversion rate?” And, the all-too-common concern… “Are we overspending?”

If so, you’re not alone. Welcome to the world of online advertising—where every click comes with a price tag. Pay-per-click (PPC) advertising can deliver powerful returns, but only when managed properly. But before you start bidding on keywords and launching search or display ads, it’s important to understand one thing:

Pay-per-click success is as much about strategy as it is about spend.

From campaign budgeting to management pricing models and measuring ROI, PPC requires more than a set-it-and-forget-it approach. Let’s break down what you need to know about PPC costs in 2025, what PPC pricing models are available, and how to budget and measure your spend to maximize ROI.

Table of Contents

Understanding the Basics of PPC Advertising

PPC advertising is a digital marketing strategy that helps drive immediate web traffic, leads, and sales. PPC, in a nutshell, is an auction. That’s why they call the price you’re willing to pay a “bid.” The ad that gets shown first is the one that paid the most, and when multiple ads are in play, they’re ranked according to bid amounts. It’s a straightforward system where your investment directly impacts visibility and clicks.

What’s the Average PPC Cost in 2025?

For most businesses, their average PPC advertising costs are around $100 to $10,000 per month. Within spaces like Google Ads and Meta, you can expect to pay anywhere from $0.11 to $0.50 per click and $0.51 to $1.00 per 1k impressions.

Factors Influencing PPC Costs

You’re probably thinking, “$100 to $10,000 per month is a pretty big gap, right?” Well, yes. While many businesses fall within this threshold, these cost projections are just that—an estimate.

In reality, a number of factors can influence what your company spends each month on PPC ads. These factors include, but are not limited to, industry competition, keyword research, chosen platform, and the quality of your landing pages.

Industry Competition

One of the biggest factors in running an online PPC campaign is the industry in which your company operates. For example, if you’re in a competitive sector (like the legal industry), you’ll probably spend more than companies in less-saturated markets (like senior living services).

Keyword Choices

Another factor that influences the cost of PPC management is the keywords you use. From a search intent perspective, different keyword classifications contribute to lower and higher bids. As mentioned above, let’s use the legal industry as an example.

  • Informational: “Do I need a Lawyer to Apply for Bankruptcy?”

Informational search keywords tend to be less expensive, as there’s not necessarily an intent to purchase based on what the user typed.

  • Transactional: “Bankruptcy Lawyers Near Me”

These search queries have purchase intent behind them, which often leads to a higher cost-per-click (CPC).

  • Competitor: “XYZ Bankruptcy Attorneys”

Let’s say the customer typed in a competitor’s business name that you also use as a keyword. In this case, “Bankruptcy Attorney.” If you bid higher and have a better quality score than your competition, your ad will appear in the #1 search position. As a helpful tip, best practices suggest going after both long-tail and short-tail keyword variations. This way, you can make your ad budget last longer.

Chosen Platform

The advertising platform you choose plays a major role in determining your overall cost of PPC management. Google Ads, Amazon Sponsored Ads, Facebook, LinkedIn, and other networks all have unique pricing models, competition levels, and targeting capabilities. For example, average CPC on Google Search campaigns tends to be higher due to broader reach and more competition, while Amazon’s CPC can vary significantly based on product category and campaign type.

Each platform also operates within its own ecosystem: Google prioritizes keyword relevance and quality score, while Amazon focuses more on purchase intent and product listings. These structural differences impact what you pay and how far your budget will go.

If you’re deciding where to invest in your PPC strategy, it helps to understand how each platform compares in terms of pricing and performance. Check out our blog post to further examine how PPC advertising prices differ between Google and Amazon.

Quality Score

Quality Score is Google’s rating of the quality and relevance of both your keywords and online ads. This metric is used to determine PPC costs and is multiplied by your maximum bid to determine ad rank in the auction process.
Your Quality Score depends on multiple factors, including:

These are the core Quality Score components. And honestly, no one outside of Google knows how much each factor weighs in the algorithm. However, we do know that the click-through rate is the most important factor, followed by the quality of content you direct the user to (which, some could argue, are mutually exclusive).

Improve Your Quality Score, Reduce Your PPC Costs

Ad copy should be compelling and sales-driven. It’s a simple premise, sure. But it’s also easier said than done. Click the button below to learn how to create product copywriting that sells.

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How Much Should My Business Spend on PPC?

When it comes to determining the overall cost of your PPC campaign, there’s not really a “right” or “wrong” way to allocate your budget. It all comes down to identifying your goals and the percentage of ad spend it’ll take to drive those results.

As businesses vary in size, industry, and target audience, so do their PPC investment needs. Larger companies often have a broader reach and advertising goals, which is reflected in higher PPC costs. On the other hand, smaller businesses often focus on niche markets or specific demographics, with this hyper-targeted approach represented in a smaller PPC ads budget.

Identify Where PPC Fits Into Your Current Marketing Spend

Most business-to-business (B2B) organizations allocate between 2% and 5% of their annual revenue to advertising costs. It’s important to note that this percentage can change based on your industry dynamics and long-term growth objectives.

Business-to-Consumer (B2C) companies deal with more diverse customer segments. In return, they often allocate a higher proportion—ranging from 5% to 10%—to accommodate multiple marketing channels and engagement strategies.

Here’s a breakdown of baseline PPC costs based on the size of your organization:

  • Small Business: $1,000 to $10,000+ per month
  • Medium-Sized Business: $10,000 to $500,000+ per month
  • Enterprise: $500,000 to $100,000,000+ per month

Just remember: these are averages. True costs fluctuate based on your specific needs, industry competition, and alternative advertising strategies.

5 Common PPC Management Pricing Models

Once you’ve nailed down your campaign budget and understand what influences your PPC pricing, the next big question is: How will you pay for ongoing PPC management services? Whether you partner with an agency or hire a dedicated specialist, PPC professionals structure their fees in several ways. Each pricing model has advantages (and potential drawbacks) depending on your PPC budget, goals, and internal resources. Here’s a breakdown of the five most common PPC management pricing models and how they work:

1. Percentage of Ad Spend

With this model, the PPC agency charges a percentage of your monthly ad spend as their management fee, typically ranging from 15% to 30%. For example, if your monthly ad spend is $4,000 and the agency charges 25%, you would pay them $1,000. As your ad spend increases, the percentage charged by the agency may decrease, such as 20% for a $50,000 budget or 15% for a $100,000 budget.

  • Pros: Aligns the management fee with your ad spend, making it fair for businesses with varying budgets. Agencies have an incentive to optimize campaigns for better results.
  • Cons: As your ad spending grows, the management fee also increases, potentially leading agencies to focus more on increasing ad spend rather than campaign performance.

2. Flat Fee

The flat fee model involves paying a fixed amount to the PPC agency every month, providing predictability in budgeting without any hidden fees. It can be a simple fee, like $2,000 per month, to manage your PPC campaigns. Some PPC management agencies might adopt a tiered flat fee model, where the fee increases with the size of your PPC budget. For instance, if you have a $5,000 monthly PPC budget, they may charge a flat fee of $1,000 per month, and for a $30,000 budget, the fee might be $3,000 per month.

  • Pros: Fixed monthly costs allow precise budget planning, and there are no surprises or hidden fees. It is suitable for businesses with consistent ad spend.
  • Cons: It may not be cost-efficient for businesses with small ad budgets, and it does not account for variations in campaign performance.

3. Performance-Based Pricing

With a performance-based pricing model, PPC management agencies charge based on their results, often focusing on lead generation or specific conversion actions.

  • Pros: You pay only for actual results, which motivates agencies to deliver high-quality leads and more conversions.
  • Cons: This model lacks consistency in costs, and the quality of leads isn’t guaranteed.

4. Project-Based Pricing

Project-based pricing involves a one-time fee for a specific PPC project or campaign, regardless of ad spend. So, let’s say you needed an agency to create and manage a PPC campaign for a product launch. With a project-based approach, they’d quote you a single fixed price to run all the ads promoting your launch.

  • Pros: Clear and fixed costs for a specific project or campaign. Ideal for short-term campaigns with well-defined scope and objectives.
  • Cons: Not suitable for businesses with ongoing or long-term PPC management needs, and it lacks flexibility in adjusting to changes in campaign requirements and PPC strategy.

5. Hourly Rate

Some PPC agencies charge based on the number of hours they spend managing your PPC campaigns, with rates determined by the agency. For example, if the agency charges $200 per hour and spends 20 hours a month managing your PPC campaigns, you would pay $4,000.

  • Pros: Transparent billing based on the actual time spent on your project.
  • Cons: Costs can vary depending on the agency’s hourly rate and the complexity of tasks.

Hiring a PPC Campaign Manager vs a Third-Party Ad Agency

In addition to the cost of a PPC campaign, there’s also the question: Who will take charge of your PPC management services? When it comes to finding someone to manage your PPC, there are two primary options: Hire an in-house PPC manager or outsource the task to a third-party agency.

Let’s break down the annual costs associated with each option:

  • In-House PPC Manager: In-house campaign managers make an average salary of $72,071 per year, equating to $6,005 monthly. However, it’s not uncommon for top earners to command salaries of up to $105,500 annually, or $8,791 per month.
  • PPC Management Agency: Outsourcing your PPC management costs an average of $30,000 to $60,000 annually, translating to $2,500 to $5,000 monthly. It’s important to note that different agencies have their own pricing models, and the quote you receive won’t be consistent from company to company.

Why PPC Outsourcing Makes Sense: The Value of Partnering with a Digital Marketing Agency

  • Greater Expertise: While you may learn about PPC online, it doesn’t compare to the understanding of professionals who do this full-time. With PPC outsourcing, you’re able to leverage the combined expertise of strategists, ad writers, data analysts, and more.
  • Cost-Effective Campaigns: Handling a PPC campaign independently can lead to costly mistakes. In contrast, outsourcing helps you avoid these trial-and-error expenses.
  • Better Tools and Resources: PPC management pricing usually includes access to the agency’s analytic tools and resources, giving you a no-cost way to streamline future campaign optimization.
  • No Learning Curve: Skip the lengthy learning curve associated with running campaigns independently. Ad agencies already know what it takes to execute a successful campaign and provide tangible results.

Help Your PPC Budget Work Smarter, Not Harder, with Timmermann Group

Managing a fine-tuned PPC campaign is no easy task, but it is by no means impossible. It all starts with a commitment to invest in the required resources. Whether you’re spending $1,000 or $100,000 a month, the key to PPC success isn’t just about how much you invest—it’s about how wisely you manage that spend.

By understanding the different cost factors, choosing the pricing model that fits your goals, and partnering with the right people, you can turn every click into a strategic opportunity. For many, that starts with PPC services from Timmermann Group.

Get the most out of your PPC ads and maximize your investment with the help of TG’s Google Ad-certified strategists. With our thoughtful approach, your PPC campaigns can do more than just drive traffic. They’ll deliver measurable growth, better leads, and more revenue.

Schedule a conversation with us today.

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