Even if you’re familiar with search advertising, it can still feel a little magical to see an ad that perfectly matches what you’re searching for on Google or Bing. You’re looking for the best vet in your area, and *poof*–an ad for “best vet Dallas” pops right up. It makes searching almost too easy.

And that’s the point. As a business owner, you want to capture these searchers and turn them into customers—especially when 88% of searches for a local business result in a call or visit.

It makes search advertising a no-brainer.

What’s not a no-brainer: What to expect from your search advertising campaigns. For instance, what’s the average click-through rate, cost per click, or conversion rate for search ads? Are your results in line with industry averages? What can be done to improve your search advertising results if not?

At LOCALiQ, we have access to the data that can give you those answers. So we’ve pulled that data from thousands of search advertising campaigns across Google and Bing to create search advertising benchmarks for the top 20 industries, including: Arts & Entertainment, Animals & Pets, Apparel, Attorneys & Legal Services, Automotive, Beauty & Personal Care, Business Services, Career & Employment, Dentists, Education, Finance & Insurance, Furniture, Health & Fitness, Home & Home Improvement, Industrial & Commercial, Personal Services, Physicians & Surgeons, Real Estate, Restaurants & Food, Shopping, Sports & Recreation, and Travel.

search advertising benchmarks - feature

What we were doing so you don’t have to!

Our search advertising benchmarks for 2021 are broken down into:

Then, to take it a step further, we talked to search advertising experts to give us some context and helpful tips to help you understand what these numbers mean.

Let’s dive into the data!

Average cost per click for search advertising

search advertising benchmarks 2021 - average cost per click

Business Category Average Cost Per Click
Arts & Entertainment $1.60
Animals & Pets $2.89
Apparel / Fashion & Jewelry $2.61
Attorneys & Legal Services $8.67
Automotive — For Sale $2.32
Automotive — Repair, Service & Parts $3.19
Beauty & Personal Care $3.74
Business Services $4.90
Career & Employment $3.90
Dentists & Dental Services $6.49
Education & Instruction $4.18
Finance & Insurance $5.16
Furniture $2.14
Health & Fitness $3.97
Home & Home Improvement $5.75
Industrial & Commercial $4.14
Personal Services $3.46
Physicians & Surgeons $3.63
Real Estate $1.40
Restaurants & Food $1.77
Shopping, Collectibles & Gifts $2.23
Sports & Recreation $1.73
Travel $1.40

Search advertising is a cost-effective advertising strategy—and the average cost per click really shows that across all industries we looked at.

The lowest average cost per click came from travel industry search advertising campaigns at $1.40, while animals and pets was close behind at only $1.60 per click.

Other industries that had a low CPC include restaurants and food, sports and recreation, and arts and entertainment.

Mark Irvine, Director of Paid Media at SearchLab, noted that even those industries with slightly higher CPCs are reasonable when you take into account the cost per average customer.

Mark also called out industries like attorneys and legal services, which have consistently seen higher CPCs than other business types.

“A lot of the industries that have historically been the most expensive continue to be the most expensive,” he said. “And that has to do with the cost for the most popular keywords in those industries, which tend to be the most expensive keywords across the board.”

Kelsie Mixon, a customer success manager for LOCALiQ, said CPC is a metric she generally keeps a close eye on.

“It’s important that we’re constantly checking on the campaigns to make sure our bids are appropriate for each keyword. If our CPC is too high, we won’t be able to prove a valuable return on investment,” she said.

(Keep reading for expert tips to control your CPC!)

 

Average click-through rate for search advertising

search advertising benchmarks - average click-through rate 2021

Business Category Average Click-Through Rate
Arts & Entertainment 10.67%
Animals & Pets 6.45%
Apparel / Fashion & Jewelry 6.19%
Attorneys & Legal Services 3.84%
Automotive — For Sale 7.93%
Automotive — Repair, Service & Parts 5.39%
Beauty & Personal Care 5.44%
Business Services 4.72%
Career & Employment 5.33%
Dentists & Dental Services 4.69%
Education & Instruction 5.46%
Finance & Insurance 5.07%
Furniture 5.73%
Health & Fitness 5.94%
Home & Home Improvement 4.21%
Industrial & Commercial 5.34%
Personal Services 6.12%
Physicians & Surgeons 6.11%
Real Estate 7.75%
Restaurants & Food 7.19%
Shopping, Collectibles & Gifts 6.33%
Sports & Recreation 7.73%
Travel 8.54%

In search advertising, your click-through rate (CTR) can tell you a lot. A low CTR might be a sign of a poor offer, insufficient targeting, or ad copy in need of optimization.

High CTR would tell you that your search ads are connecting with your audience—and driving them to take action.

Many of the industries we looked at saw a very high average CTR—over 10% for arts and entertainment and over 8.5% for travel.

To put that into perspective, available data shows an average CTR across all industries for Google Ads at 3.17%. Every industry we looked at outperforms that data and puts our average across all industries at 6.18%. (It’s important to note that our data includes both Google Ads and Bing Ads, which may also account for higher CTRs.)

Every expert we talked to agreed that CTR is a great indicator of how your search advertising campaigns are performing.

“CTR tells you how your ads are performing and can provide valuable information you can use to optimize your search ads to pull in more clicks—and more conversions,” said Susie Marino, PPC expert and LOCALiQ content marketing specialist.

Amy Bishop, owner of PPC agency Cultivative Marketing, said that while CTR is a good metric to measure, it shouldn’t be the main indicator of PPC success.

“I generally advise that CPC and CTR are health metrics. They’re important to keep a pulse on and to use as levers to achieve your goals. However, they aren’t KPIs. Focusing too much on CPCs or CTR as a KPI can be detrimental, so it’s important that bettering these metrics is never at the expense of more important metrics like return on advertising spend,” she said.

 

Average cost per lead for search advertising

average cost per lead - search advertising benchmarks 2021

Business Category Average Cost Per Lead
Arts & Entertainment $36.23
Animals & Pets $14.88
Apparel / Fashion & Jewelry $46.06
Attorneys & Legal Services $73.70
Automotive — For Sale $42.95
Automotive — Repair, Service & Parts $17.81
Beauty & Personal Care $51.42
Business Services $62.18
Career & Employment $53.52
Dentists & Dental Services $42.95
Education & Instruction $50.91
Finance & Insurance $62.80
Furniture $64.72
Health & Fitness $41.68
Home & Home Improvement $47.94
Industrial & Commercial $43.82
Personal Services $27.94
Physicians & Surgeons $26.05
Real Estate $38.86
Restaurants & Food $20.49
Shopping, Collectibles & Gifts $20.91
Sports & Recreation $27.11
Travel $37.34

Cost per lead (CPL) is an essential PPC metric for your search advertising campaigns. It measures more than just an action taken on your ad—it shows how much you spend for a user to click on your ad and contact you in some way, whether by phone, chat, form fill, or email.

We found that the average cost per lead across all industries was fairly low—a promising finding that further speaks to the effectiveness of search advertising.

For instance, animals and pets and auto repair (service and parts) had average costs per lead under $20. Several other industries, including restaurants, shopping, personal services, and physicians and surgeons had average costs per lead under $30.

Brett McHale, founder of Empiric Marketing, said that while CPL is important, it ultimately comes down to how the business is converting leads.

“You can manage higher CPLs if the bottom line is growing,” he said.

Mark notes that the CPLs, overall, are an improvement over past years’ CPLs he’s seen—likely due to the improvement in lead management systems and the way search ad campaigns are run.

“People are doing better at targeting their ads, targeting their keywords, and targeting their audiences, coupled with better CRMs to track the leads they’re getting from search advertising,” he said.

 

Average conversion rate for search advertising

search advertising benchmarks - average conversion rate 2021

Business Category Average Conversion Rate
Arts & Entertainment 5.90%
Animals & Pets 19.19%
Apparel / Fashion & Jewelry 3.60%
Attorneys & Legal Services 11.54%
Automotive — For Sale 6.57%
Automotive — Repair, Service & Parts 15.23%
Beauty & Personal Care 7.72%
Business Services 6.77%
Career & Employment 5.31%
Dentists & Dental Services 13.81%
Education & Instruction 6.16%
Finance & Insurance 5.51%
Furniture 3.25%
Health & Fitness 10.39%
Home & Home Improvement 13.23%
Industrial & Commercial 9.37%
Personal Services 10.52%
Physicians & Surgeons 19.15%
Real Estate 3.93%
Restaurants & Food 6.89%
Shopping, Collectibles & Gifts 6.70%
Sports & Recreation 6.19%
Travel 6.01%

The conversion rate for search advertising is determined by the number of leads you get divided by clicks.

Our data shows many industries, including physicians and surgeons, animals and pets, auto repair, and legal services with high average conversion rates—over 10%.

The search experts we talked to had mixed advice when it comes to conversion rate—some experts, like Brett, said they counted conversion rate as one of the most important PPC metrics to measure and a true signifier of success.

“The cost per lead and that lead’s conversion rate down the sales funnel is what is most important to my clients who are running search advertising to get leads,” he said.

Others, like Mark and Susie, say they don’t typically look at conversion rate—but rather the number of conversions and revenue coming in as a result of local search advertising.

Susie noted that the conversion rates our clients are seeing are on the “higher end” from what she’s observed, which speaks to LOCALiQ’s technology that optimizes campaigns based on what’s driving conversions.

 

6 expert tips for better search advertising results

While benchmarks are a useful tool in identifying what you might expect for your business when running search advertising, it’s important to note that there are multiple factors that influence results. These include budget, location, keywords, and more.

So we asked the PPC experts for their top tips for improving search advertising performance. Here’s what they had to say.

1. Set the right goals for your search ads

This was the top tip shared by almost every PPC expert we talked to.

“Start with your ultimate goal: How will you decide if this campaign is successful? Then build everything around that,” said Amy.

Francine Rodriguez, operations manager at BrainHi, agreed.

“Before you begin investing in advertising, you need to set realistic and attainable goals based on your specific business,” she said.

And these goals vary from business to business.

“Each business has a wholly different strategy for what a customer is, how they approach getting that customer, and how much they’re willing to pay for that customer,” said Mark.

Think about what this means for your business as you’re setting your search advertising goals.

2. Run search ads on more than just Google

When it comes to search advertising, many businesses rely on Google Ads alone. While Google Ads is an integral part of a successful search advertising strategy, you can actually get better results by running your search ads across platforms, including Bing.

Bing Ads have been shown to have higher conversion rates—and the average Bing user has a higher average income than the average Google user.

Running ads across both search engines also gives you access to more inventory, meaning more opportunities for clicks and conversions, Mark said.

how to improve search advertising performance - run ads on google and bing

So when it comes to your search advertising strategy, make sure to run your ads on both Google and Bing and optimize your budget for the placements and keywords that work best on each platform.

3. Choose the right search advertising budget

It’s no secret that search advertising is all about pay to play—it’s known as pay per click for a reason! To get the best results, you have to set and optimize the right budget for your search ad campaigns. This means understanding what you’ll have to invest to get the results you want.

Francine cautioned small businesses not to “assume that right out of the gate you will get these sorts of results.”

“When you have a new account, face low-volume keywords, or have a small budget, these results aren’t realistic. PPC is an investment, and it takes time,” she said.

4. Look for the best keyword opportunities

Certain keywords may be more expensive and may not be driving the best results for your business. By identifying the right keyword strategy, including a varied mix of keywords and keyword phrases, you can zero in on what’s working to drive the most clicks and calls for your business.

For example, you might be bidding on a broad keyword like “lawyer Kansas City,” which is a high competition and high-cost keyword, when you could narrow in your focus to “personal injury attorney Kansas City” or try a newer keyword strategy that might help you capture better searches.

Mark said this is where small businesses have an advantage over the big brands.

“The big guys are fighting against each other for the big keywords, and the smaller businesses have the opportunity to come in a lot lower for more experimental keyword strategies that the big businesses can’t or won’t try,” he said.

Additionally, Amy suggested choosing keywords that align with where your customers are in the sales funnel to increase clicks and conversions.

how to improve search advertising performance - choose the right keywords and targeting

“While we can’t always perfectly identify a searcher’s intent, we can make some assumptions about which keywords are likely to result in certain actions,” she said.

5. Create high-converting landing pages

One of the best ways to improve your click-through rate and your Quality Score (which is something Google looks at when determining both your Ad Rank and your cost per click) is to optimize your landing pages around your search advertising campaigns.

The more your landing page ties into your search ad copy, the better chance you have at converting. It’s also important for your landing page to have a clear call to action, load quickly, and be optimized for mobile devices (we’ll talk more about that next!).

Francine agrees: “If your site is not doing its job, you could have the best CPC and CTR in the world, but it will never convert.”

Get tips for building high-converting landing pages.

6. Make your search advertising mobile friendly

As more and more people search on mobile, this is a crucial piece of a successful search advertising strategy.

Grecia Maness, team lead for client success managers at LOCALiQ, said this is her number one tip for clients looking to improve their search advertising campaigns.

“You need to make sure your website and landing pages are mobile-friendly and mobile-optimized,” she said. “It’s a little thing that will really impact your search advertising performance.”

how to improve search advertising performance - make sure site and landing pages are mobile friendly

Grecia suggested checking how your landing pages and website perform on mobile if you begin seeing a lag in performance.

“If I notice conversion rate start dropping, the first thing I do is check the site on mobile. If it isn’t optimized or takes too long to load, I know fixing those issues will bring better results for our search campaigns.”

 

What do these search advertising benchmarks mean?

Search advertising benchmarks can do just that—give you a helpful benchmark to compare your search advertising results. But, as our experts cautioned, the true measure of success is more about how your business is converting the leads you get from search advertising.

Liked this? We took a deep dive into a few industries’ advertising benchmarks to give you even more insights:

 

Data source

This report is based on a sample of 18,316 North American-based LOCALiQ client campaigns in the outlined business categories that were running search advertising across all search engines between May 1, 2020, and June 25, 2021. Each business category includes a minimum of 69 unique active client campaigns. “Averages” are technically median figures to account for outliers. All currency values are posted in USD.

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