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Cost

Cost

Contents:

Cost

Quick Description = The sum total of your ad spend (not including Phone Cost)

Calculation: Cost is provided as a metric without need for calculation

Referred to as = Cost

It is possible to look at or calculate the cost of campaigns, ad groups, keywords, ads, placements etc and this figure represents how much you have spent on Clicks (or Impressions if using CPM Bidding).
Cost is ultimately what you will pay Google at each billing interval.

  • Costs are limited by the daily budget of a campaign; consequently, if a campaign is limited by budget, the cost will be very close to the daily budget. Google allows up to 20% deviation above your daily budget, they call this ‘over delivery’ but this typically averages out over time.
  • You can see how much you have been billed in the transaction history under ‘billing’.

Cost Vs. Total Cost

Cost does not include the cost of phone calls made using Google’s forwarding service, if you are using call extensions you can see the phone cost as its own metric. This has been largely phased out now as clicks on call extensions cost the same as a click without the call extension. We haven’t recently seen a different figure for ‘total cost’ compared to ‘cost’.

Cost & Budget

As mentioned the budget can be exceeded on occasion, this should average out over time however. There are only two scenarios for the relationship between cost and budget:

Cost is lower than budget: In this scenario where budget is higher than spend (cost) we often find that this is caused by restrictions on CPC through CPA or ROI targets. This forces CPC’s to be too low to be able to get enough Clicks to spend available budget.

There are cases where tweaking account settings such as accelerated spend or scheduling bid adjustments can help to bring spend up to the same level as budget.

Cost is the same or slightly higher than budget: This is the ideal scenario where you are spending 100% of the available budget. You will often see that campaigns are ‘limited by budget’ when spend and budget are equal.

If you are tracking revenue, profit, ROI, etc and are optimising to these goals, campaigns limited by budget are huge opportunities; as a campaign hitting an ROI target (that translates into real world ROI) and is limited by budget means that there is scalability within the campaign.

Reporting & Analysis

Cost is viewable by default in pretty much every report in AdWords and can be seen as a metric of any component of the account for which reports exist.

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