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How much should you spend on Google Ads in 2026?

If you’re asking “How much should we spend on Google Ads?”, you’re not alone. It’s one of the most common questions businesses ask before launching PPC.

The truth is this:

  • There is no one-size budget
  • But there is a right way to calculate your ideal spend
  • And most businesses dramatically under-budget their campaigns

This guide breaks it down simply, with real examples and a formula you can use today.

Why your Google Ads budget matters more than ever in 2026

Google Ads costs are rising every year due to:

  • Higher competition
  • AI-led bidding favouring accounts with more data
  • Broad match signals requiring larger data sets
  • CPCs increasing across nearly every industry

Small budgets can still work, but they need to be strategic and focused.

First question: What do you want to achieve?

Your budget should match your goal:

Goal 1: Generate leads

(Example: Trades, healthcare, legal, home services, B2B)
Budget depends on cost per lead in your industry.

Goal 2: Generate sales

(Example: eCommerce)
Budget depends on ROAS targets and product margins.

Goal 3: Build awareness

(Example: New brands, expansion campaigns)
Budget depends on reach, impressions and competitive positioning.

Once you know why you are advertising, you can calculate how much.

A simple formula to calculate your Google Ads budget

This is the most accurate approach and works for almost every business:

Budget Formula

Monthly Budget = (Number of leads or sales you want × Your typical CPA)

Or for eCommerce:

Monthly Budget = (Revenue target ÷ Target ROAS)

Example: Lead generation business

Let’s say:

  • Your ideal cost per lead: £30
  • You need 50 leads per month

£30 × 50 = £1,500/month minimum budget

If CPCs in your industry average £3-£5, this lines up with 300-500 clicks.

Example: Ecommerce business

Goal: £20,000 in revenue per month
Target ROAS: 5×

£20,000 ÷ 5 = £4,000/month budget

If your margins are tighter, your target ROAS needs to be higher.

Recommended budgets by industry (2025 averages)

These are realistic minimums for strong learning and performance. Note that CPC/CPA will often vary based on location, service and competitor activity.

Healthcare clinics (e.g. podiatry, physio, dentistry)

£750-£2,000/month
CPCs: £1.50-£4
CPA: £15-£60 depending on service

Trades (plumbers, electricians, roofers)

£500-£1,500/month
CPCs: £2-£7
CPA: £20-£70

Legal (solicitors, injury claims, family law)

£2,000-£10,000/month
CPCs: £5-£25+
CPA: varies heavily by niche

eCommerce

£2,000-£10,000/month
Depends on product volume, margin, AOV

Local service businesses

£500-£1,200/month
Works well with tight keyword targeting + local radius

B2B SaaS or services

£2,500-£15,000/month
CPCs: £5-£30+
CPA often high but ROI strong

If your market is extremely competitive, expect to be at the top end of these ranges.

Why small budgets struggle (and how to avoid wasting money)

Under £500/month makes Google Ads much harder because:

  • You don’t collect enough data for smart bidding
  • You generate too few clicks to learn what works
  • Broad match becomes risky
  • You may only get a handful of conversions

But it can work if you:

  • Use Exact/Phrase match
  • Build a tightly focused keyword list
  • Limit geography
  • Exclude research-intent searches
  • Regularly review search queries and exclude searches as negative keywords
  • Use a high-converting landing page and improve your landing pages
  • Utilise micro-conversions to support building data for SMART bidding

Small budgets require discipline, not guesswork.

How to know when your budget is too low

Your budget is likely too small if:

  • Your daily budget caps by midday
  • Google says “Limited by budget”
  • Impression share is under 40% (although this figure varies if broad match keywords are used)
  • You only get 1–2 conversions per week
  • Costs fluctuate massively day to day

Your campaign needs stable data to be profitable, not just occasional spikes.

How to know when to increase budget

You should increase your spend when:

  • Your CPA is stable or dropping
  • Your impression share is low but profitable
  • Demand is higher than what you can currently serve
  • Your landing page converts well

Many businesses scale too late, resulting in lost market share while competitors dominate.

How much should you spend?

Here’s a simple rule:

Spend enough to get 30–50 high-quality clicks per day
(Or 10–15 conversions per week)

This is the minimum needed for Google’s AI to optimise efficiently.

For most industries, this means:

£750–£1,500/month for lead gen
£2,000–£5,000/month for ecommerce

If you’re in legal, finance, SaaS, or highly competitive niches, then budget climbs accordingly.

As some final advice for determining your minimum budgets:

  • Use the formula
  • Match spending to your goals
  • Adjust based on CPC and competition
  • Don’t starve campaigns — let them learn
  • Start with a recommended budget and scale based on results

Want an exact budget based on your industry?

If you want this information laid out clearly and accurately, get in touch and we can help provide:

  • Your ideal monthly budget
  • Your expected CPC
  • Your expected CPA
  • Competitor benchmarks
  • Projection of leads/sales you’ll get