How To Set Google Ads Budgets Correctly - Google Ads Budget Recommendations and Forecasting

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Google Ads Budgeting: A Google Ads budget is the amount of money you choose to spend on your ads each day. Setting the right Google Ads budget helps you control costs, reach the right people, and get better results from your campaigns. You can set a budget for each campaign, so it's easy to focus more on ads that are working well or test new ideas without going over your limit. Whether you have a small or large budget, understanding how Google Ads budgeting works—like how daily limits are managed and how Google spreads your budget over time—can help you spend smarter and avoid wasting money.

Summary of Key Points (with Timestamps)
[00:00–01:00] General Approach to Budgeting

The video explains how to set Google Ads budgets using three business examples: a local plumber, an e-commerce fruit tree seller, and a yoga studio.

Emphasis on starting with test budgets and scaling based on performance and cost-per-lead data.

[01:00–03:45] Local Plumber Example

Recommends starting with Local Service Ads (LSAs) for service businesses like plumbers.

Suggests a starting budget of $1,000/week ($4,000/month) to ensure effectiveness.

Highlights that too low of a budget won’t yield useful results.

[04:00–13:00] Search Campaign Budget Forecasting

Demonstrates using the Google Keyword Planner to estimate costs per click (CPC) and forecast results.

Recommends $5,000–$6,000/month for plumbing campaigns in high-competition cities like NYC.

Points out that higher daily budgets (e.g. $300/day) may be needed to reach optimization thresholds (~200 clicks/month).

[14:00–21:30] E-commerce Example (Fruit Trees)

Emphasizes using return on ad spend (ROAS) to guide budgeting.

Shows how to use conversion rate and customer lifetime value to adjust forecasts.

Suggests starting with $4,000–$7,500/month, potentially scaling to $15,000+ if return is justified.

Notes that Performance Max and Shopping campaigns may reduce CPC compared to Search.

[21:54–29:20] Local Yoga Studio Example

Budgeting is challenging due to lower search volume and intent.

Recommends $1,000–$2,000/month to test demand.

Suggests combining Search + Performance Max for local reach and brand awareness.

[29:20–30:45] Budgeting for Other Local Services (e.g., Dentists)

Local service businesses like dentists or landscapers often need $3,000–$5,000/month minimum.

Higher budgets may be justified if targeting high-value procedures (e.g., dental implants).

[30:45–31:13] Final Thoughts

The most important metric is ensuring 5–15+ clicks per day to gather meaningful data.

Budget decisions should be based on expected CPC, conversion rate, and overall ROI.