The Most Expensive Google AdWords in Australia by Industry
In this guest post, Anna Lebedeva of SEMrush shares advertising insight into the most expensive key words by industry.
Everybody knows that Google has many sources of revenue, but it’s largest one, its cash cow, is advertising, which accounted for 90 percent of its revenue in 2015. And Google’s growth for last year was about 15 percent, which amounts to billions of dollars.
The overall trend is that digital advertising itself is becoming more popular as more companies are choosing online advertising over more traditional options. According to a recent eMarketer projection, digital advertising spending will even surpass TV in 2017.
If you’ve ever created a Google AdWords campaign, you probably know that it can be extremely expensive. In the past few years, marketers have seen a significant increase in the cost-per-click for popular keywords, and this trend will probably continue.
Basically, cost-per-click is calculated by a sort of “auction” that takes place during searches. The most expensive keywords are simply those that are searched for the most, the ones competitors are willing to bid on. But you can always target so-called long tail keywords, which are less competitive, but they can still bring you a significant amount of traffic.
As we all know, costs-per-click dramatically differ depending on the industry and location, varying anywhere from one to three digits per visitor.
Have you ever wondered what the most expensive keywords are for Google AdWords Australia?
What we found out
We compiled data from SEMrush’s keyword database to determine the top 200 most expensive keywords searched for in Australia. This keyword list is broken down into seven industry categories and, for simplicity, presented with infographics, which you can find below.
All keywords that are on this list are long-tail and very targeted. Despite the fact that they cost a lot, they don’t receive much traffic (on average 10 – 250 monthly), this can be explained by their high competitiveness.}
The highest CPC was calculated in the following categories:
Insurance (most expensive keyword phrases: “income protection insurance” and “life insurance”)
Legal services (“motorcycle accident sydney” and “the personal injury lawyers”)
A majority of the most expensive keywords represent the insurance industry, offering popular income, life, funeral insurance or a quick quote on them. Insurance companies traditionally bid high on AdWords campaigns as they usually profit from each client, which means it’s worth paying for extremely expensive clicks.
As one might expect, keywords related to legal services account for 20% of the most expensive keywords with personal injuries, vehicle accidents and income protection at the top of the list.
I want to believe that there aren’t very many traffic accidents in Sydney, but the ROI of this PPC must be incredibly high if companies are ready to bid on a price like that.
Finance and trade (“best mobile trading app” and “foreign exchange trading australia”)
And as you can see in the infographic, 73% of the most expensive keywords are related to three industries: finance, insurance and law. These categories represent businesses with a very high lifetime customer value, which is why they are ready to pay more to get new clients.
Software (“customer data management software” and “best algorithmic trading software”)
The two most expensive keywords are related to finance and trade: “best mobile trading app” and “foreign exchange trading Australia,” which cost $276 and $256 per click respectively. These two are followed by “customer data management software,” which is priced just over $200 per click.
In the software business, there are many companies with huge budgets, and very often it is better to compete for leads by creating and promoting content giving expertise.
Business and marketing (“social media roi” and “enterprise mobility”)
Gambling (“betting odds horse racing” and “sportsbet logo”)
Household (“carpet flood damage melbourne” and “flood restoration australia”)
These categories represent businesses with a very high lifetime customer value, which is why they are ready to pay more to get new clients.
We also discovered that 9% of keywords are location-sensitive with “Australia,” “Sydney,” “Brisbane” and “Melbourne” the most common. This simply means that PPC are especially high in case of bidding for the big city with highest volume of searches.
If you represent a local business, such as a law firm or an insurance agency located in a particular neighbourhood of a large city, you must use a keyword that locals would search for in order to rank high in your area. Think like a consumer, and in order to avoid paying too much (as you see in our list), you need to narrow your choices and use geo-targeted long tail keywords.
More than 42% of the most expensive keyword phrases consist of more than three words, which makes them detailed and highly targeted. Each additional word tells you more about user intent, so the longer a keyword phrase is, the more targeted clients you will get and the more relevant results you can deliver.
Anna Lebedeva is the PR manager at SEMrush
When the cretins who run marketing departments in Aus realise they are now paying 100x what their ad was in the yellow pages, the penny will drop in google’s business model. Until then it’s all frothy digital exceitment….
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@Rush me home
Do you have any evidence or insights to back up your assertion?
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An Ad in Yellow pages is $18 per month.
You can work out the rest…
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And yet no one uses the yellow pages to find goods and services anymore…no matter how cheap it’s inefficient.
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Adwords uses a bidding system. You can set a limit on the cost of each click or daily cost.
If you are in an industry where the words are not as competitive it can be a lot cheaper than yellow pages and more effective too.
I’m not necessarily a worshipper of google who are tax dodgers but they are not stupid either.
We ask new customers where they heard about us and so far no one mentioned yellow pages….
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@Rush me home
Advertising on a billboard in the middle of the desert, because it is cheap to do so, is imbecilic.
There might be some value in the Yellow Pages, to reach a small fragment of our society. The mainstream is now on Google and the spend is being hauled away from a plethora of ‘traditional’ platforms, not just directories. Think how expensive TV is, well that is incorporated in adwords spend, as are again many other platforms.
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Obviously some of these CPC’s are going to be high – the intent on each of these searches is significant.
What this study lacks is any insight into search volumes, and also the correlation of these words into LTV and CAC.
If i convert 10% of life insurance traffic my CAC is still 1500 and would leave me ROI positive.
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RO, what is rational about a riposte referring to a billboard in a desert? A rather irrational analogy methinks.
So a typical TV buy may have a Cost per Mille of around $60, and this article quotes a Cost per Click range of $87-$276. So the cost of 1 thousand (Mille) clicks is $87,000 to $276,000.
Now assuming that EVERY click is real, human and ends in a purchase (I know – it is a long bow to draw but let’s be generous), at what rate would a TV ad need to convert its audience to a purchaser at the same cost efficiency.
The $87k CPC for 1,000 clicks (sales) would buy a TV audience of 1.45 million, so every 1,450th viewer would need to make a purchase’. For the $276k CPC for 1,000 clicks the TV audience would be 4.5m and you would need every 4,500th viewer to make a purchase.
Given that not every click is a purchase – and the sales ‘funnel’ was probably filled using other media – you would only need the thinnest sliver of the audience to purchase and TV is the more cost efficient and effective buy. And by the way the other millions of the audience may not have bought the product but they were exposed to the brand on the most effective medium.
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Biggest traffic source for Yellow page is Google(mainly Paid search)
You can see their ads on lots of unnecessary keywords as well, just to get traffic coming in.
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I love tennis.
@Rational Commenter
I will spell it out for you: The Yellow Pages is like a billboard in the middle of the desert. It might be cheap and affordable, however if nobody is looking at it then what is the point of advertising in it?
Tracking:
Smart marketeers can monitor, which taps deliver them the sales and which ones do not. Obviously a smart marketeer will turn the taps that return low value off, or reduce spend, or negotiate a far lower rate with the publisher / media provider. There are numerous analytic’s tools that marketeers use and they will certainly not take a publishers word for reach or readership, (well they shouldn’t do).
Oh and we haven’t touched on SEO, which was the real killer of the YP’s. This is of course, well; free!
(I do not have a vendetta against the YP’s. I do question why so much defence for it on this thread? Do we have Sensis guys on this thread..?)
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@comment 9. Over 80% of YP’s traffic in AU is from search. I would argue that it is organic or publisher network related.
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Excellent study using one of the best online marketing tools on the market.
There are some industries that are just becoming untouchable from an Adwords perspective – plenty of organic opps though!
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I was right.
Yellow Pages is good.
And TV is better; so advertising the Yellow Pages on TV must be best of all.
It’s so important to be right in the comments section.
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We live in a supply and demand world – hence why the YP is two lots of stuff all to buy – and Google – amongst other online offerings – allow people to compete for the prize. My biggest question is still the hundreds of millions – and excuse the french – ‘wasted’ on TV advertising with no tangible results. That age old saying of ‘oh we know TV works’ yet the only real way of measuring is OZTAM and sales data.
Sounds like Google is getting a raw deal if you ask me.
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Yes Ummm your first statement is correct regarding supply and demand.
The thing is (linear) TV has limited supply (though 3x what it had a decade ago) regulated by government regulation as to how many minutes of ads per hour can be shown and the fact that there are just 24 hours in a day.
Conversely, online (dominated by Google in Australia) has virtually unlimited supply spread a billion websites and hundreds of billions of webpages.
Demand is finite and with small growth (limited by population and growing courtesy of device penetration but that normally means substitute usage).
Economics 101 tells you that with finite demand and infinite supply prices fall. Conversely, with finite demand (albeit growing slowly) and fixed supply, prices can still increase but only marginally.
Now Ummm I would wager that majority if not all the mega-brands of this world use TV advertising, and the long-established brands were all built on TV advertising and are still growing long. None would say they wasted their dollars on TV. Plus, the list of those brands would far exceed the list of online-only brands – Uber is probably the online pin-up.
And I’m not aware of any serious marketer or advertiser who would use OzTAM ratings and sales only as their measure of success (though all would or should have sales in there). Further, if they did it would still be miles ahead of last-click attribution models which are embarrassing in their naivety.
Sounds like Google’s deal is as juicy as their taxation arrangements.
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@comment5 Well said Philip.
What some businesses fail to see is that these are highly relevant traffic which is being driven to the business’ products/services and continue to advertise on other mediums which may not be as measurable.
Adwords provides an opportunity to showcase your offering to an audience with intent. What is key is to maintain a positive ROI from the advertising spend.
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It’s getting crazy…
Finance keywords are booming too.
I just wonder why, Life insurance companies look for Facebook Advertising. Much cheaper and targetted.
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I think the carpet flood keywords are inaccurate.. at least according to keyword planner the estimated bids are hugely different to what is listed here. Plus I don’t know how the lifetime value of this type of customer can even come close to comparing to the lifetime value of a life insurance client.
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