All Industries Seeing Google Ads Cost Per Lead Increases

Google Ads is an extremely popular channel for paid advertising for businesses big and small. But just like the price of so many other items has gone up with inflation in 2022, it turns out, so has the price of Google Ads. According to a new Wordstream study, Google’s cost per lead has increased significantly for several industries year over year. We’ll tell you more about the report, which industries were hit the hardest, and the average overall increase in cost per lead over the last year. Plus, we will discuss how and why Google Ads CPL has increased for nearly all industries YoY.

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Report: Google Ads Cost Per Lead Has Increased Dramatically

The cost of Google Ads can be confusing. According to Wordstream’s industry benchmarks report, the Google Ads cost per lead has increased for 91% of industries YoY. The industries that were most impacted in 2022 by the increase of Google cost per lead was arts and entertainment, travel, and furniture. However, a few industries did see a decrease in cost per lead, including Finance & Insurance and Education & Instruction. 

Cost Per Lead Increased Significantly 

Out of the 23 industries in the study, 21 saw an increase in cost per lead. The overall average increase was 19%. For comparison, last year the overall average increase in cost per lead was 5%. 

Conversion Rate Has Also Decreased

According to the same Wordstream study, not only has cost per lead increased dramatically, but conversion rates have also decreased. Ninety-one percent of industries experienced a decrease in conversion rates. The average overall decrease was 14%. 

Cost Per Click Has Slightly Increased 

A little more than half of industries saw an increase in cost per click, however it was a less dramatic increase than the cost per lead. The average overall increase was 2%. 

Click-Through Rate Remains Stable

There is some good news. There was no overall average change in click-through rate, which has remained stable. This means that people are still clicking on ads, they just aren’t converting. 

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What Does Google’s CPL Increase Mean? 

It’s important for marketers to know what your campaign costs are in relation to industry benchmarks. If your business has been affected by the increased price of leads on Google Ads, it is most likely due to inflation, the pandemic, or the latest changes in automation and keywords on Google. 

What Is Causing Google’s Cost Per Lead Increase?

You might be wondering what is causing these Google Ads changes in CPL. A few reasons include 

Inflation is Affecting Conversion Rates

We have all experienced the effects of inflation. One result is that consumers are more conscious of their spending. For example, many people are cutting back on travel and restaurants. This could be responsible for bringing down conversion rates and increasing the cost per lead, especially in industries like arts and entertainment, travel, and clothes and jewelry. 

Supply Chain Shortages 

Supply chain shortages are also indirectly affecting the cost of leads on Google.  

Broad Match is Broader Than Ever 

Google removed modified broad match keywords last year and also has been pushing for accounts to use broad match with Smart Bidding. This is leading ads to appear for more queries, including those with low commercial intent. This means that fewer people are converting.higher cost per lead on google ads

How to Adapt to Higher Costs Per Lead on Google Ads 

There are a few ways you can respond to these shifts in costs of Google leads.

Utilize Negative Keywords 

Negative keywords are a great way to make sure you are reaching the right audience with your Google Ads and aren’t wasting any of your precious budget. 

Increase Paid Search Budget

As there is more and more competition on Google Ads, one way to keep up is by increasing your paid search budget. Don’t wait until 2023: begin with the 2022 holiday season. 

If increasing the ad budget is not possible, consider improving your Quality Score and ad relevance, optimizing your keywords, and checking out your competition. 

Create a Full-Funnel, Cross-Channel Strategy

Make sure you are reaching the right audience with a full-funnel, cross-channel marketing strategy. There are many ways to reach your audience other than Google Ads. Our digital marketing experts can help you choose another strategy that might work for you.  

Use Phrase Match, Exact Match, or Dynamic Search Ads Instead

To combat the issues with Broad Match, try using phrase match, exact match, or dynamic search ads instead. 

google ads cpl increase

Get Cost-Effective Google Ads from SEO Design Chicago

If you need help creating holiday campaigns for Google Ads for your business, planning a Google Ads campaign for 2023, or any other assistance with Google Ads, trust the digital advertising team at SEO Design Chicago. We can help you follow the best practice for Google Ads campaigns and continue testing and tweaking your campaigns to ensure your costs remain under control. 


  • Has the cost of Google Ads gone up?
  • What is causing Google’s cost per lead increase?
  • How can I adapt to a higher cost per lead on Google Ads?
  • Which industries have experienced the highest jump in cost per lead on Google Ads?
  • Has Google Ads click-through rate changed? 

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