Why is my cost per click higher than other advertisers in my industry?

Cost per click is set by auction competition and Quality Score, not by how well your business is doing. Legal, finance and insurance categories run $5 to $8+ CPCs because a single client is worth a lot. Ecommerce runs under $2 because the auction has more advertisers competing for lower-value clicks. A high CPC isn't a grade on your account.

Does a high CPC mean my campaign is underperforming?

No, not on its own. The only number that matters is cost per click against what a click is actually worth to you once it converts. A $6 CPC that reliably turns into a $3,000 client is a good result. A $1 CPC that never converts is a bad one. Judge cost tolerance, not the raw CPC figure.

What's a good CTR for my own branded search terms?

30% or higher. Below 15% usually means a competitor is bidding on your business name, or your organic listing and reviews are winning the click instead of your ad. Either way, it's the cheapest traffic you'll ever buy, so it's worth fixing first.

Benchmarks — Paid search

Google Ads benchmarks: CPC and CTR by intent

Competitive click-through rate sits between 2% and 5% for most commercial search terms, and above 30% for your own branded terms. Cost per click is set by auction competition, not performance, so we grade it separately from CTR.

Click-through rate, graded by intent

Someone searching your business name directly.

Tap the band you sit in and it follows you around the benchmarks.

Grade	Range	What it means
Developing	Under 15%	A competitor or a confusing search results page is winning clicks that should be yours by default. Check who else is bidding on your name.
Competitive	15% to 30%	A reasonable share of your own name searches, with some leakage to organic listings, reviews or competitor ads.
Leading	30% and above	You're capturing most of the demand for your own name. This is the cheapest, highest-intent click you can buy.

Cost per click, graded by cost tier, not performance

We don't grade CPC as Leading, Competitive or Developing. A high CPC in legal services can be a great result. A low CPC in ecommerce can still be a loss if the margin doesn't clear it. CPC only means something against what a click is worth to you, which is cost tolerance, not a performance score.

Show in

Tier	Cost per click	What it means
Cheap	Under $1.50	Typical for ecommerce and broad consumer retail search, where competition per click is lower and volume is the strategy.
Typical	$1.50 to $5	Where most commercial search terms in Australia land in 2026, including trades, home services and mid-ticket retail.
Expensive	$5 and above	Normal for legal, finance, insurance and other high-value B2B or considered-purchase categories, where a single client is worth thousands.

What moves the bands

Search network vs Display vs YouTube

Search CTR averages run 3% to 6% across all industries. Display averages under 0.5%. Comparing across networks rather than within one always produces a misleading read.

Match type and audience targeting

Tighter keyword match types and narrower audiences push both CTR and CPC up. Broad match with automated bidding usually lowers both, trading precision for volume.

Industry auction density

Legal, finance and insurance run the most expensive clicks in the market because the value of a single converted client is high enough to support it. Ecommerce and broad retail run the cheapest.

Ad rank and Quality Score

A stronger Quality Score lowers CPC for the same ad position. Two advertisers bidding on the same term can pay very different prices for the same click.

How we set these bands

These bands come from running Google Ads accounts for Australian clients across every search intent, calibrated against published cross-industry CTR and CPC studies. Auction dynamics move with AI Overviews, Smart Bidding and advertiser volume, so the bands are ranges to test an account against, not a fixed target.

Against the published record: the 2026 WordStream study reports a 6.64% average search click-through rate and a US$5.42 average cost per click across United States accounts. Both sit above our bands by design. US blended averages are lifted by branded terms and the most expensive legal, medical and home-services auctions, and they describe a hotter auction market than Australia's. We calibrate to the Australian auction, not the US blend. An account graded against the wrong market reads as underperforming when it isn't.

Corroborating sources

Our take

A lot of accounts get judged on CPC alone, and that's the wrong number to stare at. Cost tolerance is the only question that matters. What is a converted customer actually worth to you, and can you pay what the auction is asking and still make money on it?

If you turned a campaign off and revenue dropped, now you know something. If you turned it off and nothing changed, why are you spending the money there? CTR tells you if the ad is doing its job. CPC and conversion value together tell you if the channel is doing its job.

Frequently asked

It depends entirely on intent, not industry. Branded search should clear 30%. High-intent commercial terms are competitive between 2% and 5%. Broad Display and awareness placements are competitive between 0.3% and 1%. Comparing a Display CTR to a branded search CTR will always look like a failure that isn't one.

Industry benchmarks on Atlas

B2B SaaS & Software →Legal Services — Commercial (B2B) →Ecommerce — D2C Retail →

Marketing Dictionary

CPC →CTR →Conversion tracking →

More benchmarks

Website conversion rate benchmarks →Marketing budget as % of revenue →

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