By Larry Kim
When you evaluate your Google AdWords performance and conversion rates, what are you comparing against?
If you’re like most advertisers, your primary source of insight is probably your own historical data. As long as you’re trending towards better than worse, you’re doing great… right?
It’s important to track your performance over time and make sure you’re constantly improving, but using only your own data tells you nothing about how you’re doing against your competitors (AdWords is a live auction, after all).
We recently ran an extensive analysis of more than 2,000 client accounts in all verticals, representing over $34 million in AdWords spend, to establish current, accurate average conversion rate (CVR) benchmarks for both Search and Display ads across 20 different industries: Advocacy, Auto, B2B, Consumer Services, Dating & Personals, E-Commerce, Education, Employment Services, Finance & Insurance, Health & Medical, Home Goods, Industrial Services, Legal, Real Estate, Technology, and Travel & Hospitality.
What is the average conversion rate on Search & Display?
So how do you know whether you’re middle of the road, or getting left in the dust?
We found that on average, Google AdWords advertisers are seeing conversion rates of 2.70% on the Search network, and 0.89% on the Display network.
Benchmarks are an important consideration on top of your own data, because if you were getting 1% conversion for your Search ads and doubled it to 2%, you might think that was pretty awesome. You doubled your CVR, that’s amazing! Woot!
Except you’re still doing 0.7% crappier than the average, and the average isn’t exceptional. It’s just… average.
Don’t settle for average conversion rates – be a unicorn in a sea of donkeys
Who the heck aspires to be average?
If you aren’t even doing as good as middle of the road, average might seem pretty attractive, but you can do so much better than that.
The range on conversion rates varies so greatly that the top 10% of advertisers are regularly getting conversions FIVE TIMES better than average. Not only can you be better than average, but once you surpass that plateau, you can do incredibly well in AdWords.
It’s crazy; there are all these accounts seemingly content to hover around slightly below or slightly above average. I call these advertisers the donkeys. They stubbornly just sit there, waiting for something to happen.
But then you have the unicorns; those accounts that are not only doing better than average, but slaying the averages by converting at exponentially higher rates – up to five times higher. These advertisers enjoy not only more conversions, but typically a way lower cost, too, as more engaging ads drive higher Quality Scores and lower CPCs as a result.
Don’t be a donkey.
So which industries convert best on the Display network?
The surprising top converting industry in Google Display ads
You might think that Travel & Hospitality or maybe Dating & Personals ads would kill it on the Display network, because they’re just so much sexier and exciting than other industries, but you’d be wrong…
They actually have the lowest conversion rates among industries for Google Display ads!
So which super sexy industry does best with Display ads? Well, um… it’s Home Goods. Would you believe ads about couches, lamps, desks and other furnishings and goods for the home convert at an average rate of 2.19% in Display? That’s higher than any of the twenty other industries we evaluated.
The top five best converting industry types for Display are:
- Home Goods with an average 2.19% CVR
- Finance & Insurance: 1.75% avg. CVR
- Real Estate: 1.49% avg. CVR
- Employment Services: 1.28% avg. CVR
- Technology: 1.04% avg. CVR
And who fares the worst? The average CVR in the Advocacy industry is an abysmal 0.37%.
Top converting industry average Search CVR is almost 3x higher than overall
In the Search network, one industry is killing it to the extent its average conversion rate is nearly three times higher than the average CVR across Search as a whole.
Insurance and Finance ads enjoy an average 7.19% conversion rate on the SERPs, a full 2.19% higher than the next highest industry average:
Understanding these averages is critical, because how you fare against others in your area can seriously impact your costs and ROI. For example, you could be converting at 3.5% and think that’s pretty decent, yet find it hard to justify what you end up with as your cost per acquisition. That might leave you thinking AdWords just doesn’t work for you.
But if you’re in Consumer Services, where the average conversion rate is actually 5%, the reality is that you’re seriously underperforming. If you’re converting less than average, your ads aren’t resonating, your QS is going to suffer, and you’re going to pay MORE for each click.
Check out the average Conversion Rates across the 20 industries we analyzed and see how you stack up:
For new Google AdWords benchmark CPCs, CTRs and CPAs by industry, see our full analysis on the WordStream blog.
Source:: Search Engine Watch RSS