Is Your Google Ad Conversion Rate Normal – Or A Red Flag?

Just like the words ‘engagement’, ‘impression’, and ‘conversion’ have different meanings in the real world, they mean completely different things in an advertising campaign. They aren’t just words – they are metrics that tell you whether you're wasting or making money on your campaigns. Moreover, the introduction of newer technologies such as Google’s Search Generative Experience (SGE) and AI-Extended Optimisation (AEO) significantly impacts these metrics – most importantly your conversion rate which could make or break your success with advertising. And whilst the strategies and tactics to ensure a good conversion rate are many, nothing will ensure a good conversion rate like this one cardinal rule: give the people what they want, not what you think they want. But more on that later! Today’s article dives deep into what a “good conversion rate” actually is and how advertisers and business owners alike can influence their own Google Ad campaigns to produce better results!

So, what’s a good number? 3%? 15%? 1%? Fortunately there is no one answer. A “good conversion rate” changes from industry to industry and is determined by the performance of:

• Other businesses in your market.

• Your target audience.

• How well you adapt to the everchanging advertising ecosystem.

• The alignment between your product and the consumer.

And this is just to name a few! The performance of your Google Ad campaigns is determined by a lot more but before we explore that, let’s take a look at what a ‘conversion rate’ actually means and how it’s calculated!

What Is a Conversion Rate in Google Ads?

In Google Ads, your conversion rate is the number of people who click your ad and then complete the desired action on your website. 

Simply put, conversion rates measure how well your ads turn clicks into actual results. ‘Clicks’ means customers and ‘results’ translates to the action you want them to take with your business. This could include making a purchase on your website, booking an appointment, or signing up for a class.  So before you determine whether your conversion rate is good or bad, it’s important to understand what results you want from your advertising campaigns. Once that’s done, use the formula below to calculate how effective your campaigns are at generating those results!

How Conversion Rate Is Calculated?

Fortunately, the math is very simple! To calculate your conversion rate:

Conversion Rate = (Number of Conversions / Number of Clicks) * 100

So, if 100 people click your ad and 10 people buy something, your conversion rate is 10%. Similarly, if 100 people click on your ad and 15 people book an appointment, your conversion rate is 15%. 

Why Knowing Your Conversion Rate Matters.

Conversion rates are the easiest and quickest way to tell if your campaigns are wasting your money or making you money. What information could be more important than that? Knowing and actively tracking your conversion rate helps your advertising team make better choices - decisions that can help your campaigns generate a better ROI (return on investment). For example, if 100 people click onto your website but no one buys, there’s likely something wrong with your website or your campaign. Perhaps your checkout system isn’t working or your campaign is targeting the wrong people. However, if 100 people click onto your website and 15 of them make a purchase, then your campaigns are on the right track! In a situation like this, you might even want to spend more money on your campaigns!

Google Ads Conversion Rates in 2025

In 2025, online ads are super competitive but can pay off big time. Businesses are getting great results from their ad money because of better targeting and smarter AI. So, the average conversion rate in Google Ads has also gone up.

Unfortunately, we don’t exist in a vacuum. Advertising is a hyper-competitive space as many businesses - just like you - are competing to win the same customers. But all hope is not lost! Fortunately for us, tech giants like Google and Facebook continuously introduce new technologies to help us generate even more returns on our advertising investment. For example, Google’s Search Generative Experience (SGE) - an AI-powered upgrade - is already helping businesses see:

• More qualified traffic (means better conversion rates)

• Greater visibility across the Google search engine

• Better results on specific campaigns like Google’s Shopping Ads formats

And whilst this certainly makes advertising less daunting, it also means advertisers and business owners alike must stay up-to-date on the advent of such technologies if they want to continue experiencing greater performance across their campaigns.

The Average Rate in 2025

While this isn’t a one-size fits all approach, the average conversion rate on Google Ad campaigns in 2025 is approximately 7.52%. That means that for every 100 clicks on an ad, approximately 8 people are taking the desired action such as making a purchase, booking an appointment etc. The most important takeaway from this number is that Google Ads still has the potential to generate significant revenue (and value) for a business provided that business invests the necessary resources to build SMART campaigns.

In fact, in 2024, Google Ads generated an average conversion rate of 6.69%. This number was even lower a few years ago where the average was a small 4.61%. This steady increase not only highlights improvements in Google’s advertising ecosystem but also indicates that businesses are building stronger ad campaigns. Are you one of them?

What Should This Tell You?

The number ‘7.52%’ should be used as a loose benchmark against which your campaigns should be judged. However, for a more detailed approach, use the following industry benchmarks – (numbers derived from Google Ads Benchmarks Wordstream) – to determine whether your campaigns are performing below, equal to, or above industry standards! NOTE: These numbers are specifically for Google Search campaigns.

For a hyper-precise approach to competitive benchmarking, click this link to learn more about how you can determine the average conversion rate of your industry in your location! 

What’s affecting your Conversion Rate?

As mentioned before, there are many different factors that affect your conversion rate and the overall performance of your advertising campaigns. The amount of money you spend on a campaign is a huge factor for many different reasons. At their core however, platforms like Google and Facebook run on auction systems – meaning the more you're willing to invest, the more likely you are to win premium ad placements and higher-quality customers. Aside from money, the following factors also significantly influence the performance of your ad campaigns.

Targeting and Audience Segmentation 

Ads perform better when shown to people who actually care about what is being advertised. If you target people who are interested in what you're selling, you are likely to get more sales. While this sounds like common sense, you’d be surprised how many businesses fail to understand what their customer is actually interested in and as a result, fail to align their product as a solution to the customer’s problem. For a more detailed guide on how to craft effective targeting strategies, click here!

Ad Copy Relevance

Ads that are easy to understand and focus on the customer-facing benefits (instead of product-related features) usually generate better results. It’s simple: if your ad directly addresses a customer’s problem or emotional need, that customer is likely to take action. Many businesses fail to understand the emotional needs of their customers which results in ads that are impersonal and foreign to what the customer actually wants. Lucky for you, we broke down exactly how to craft relevant ad copy so that your campaigns can perform better! Click here to learn more!

Your Landing Page

A good ad is wasted on a landing page that isn't easy to use. A clear button – otherwise known as call to action – that tells people what to do can make or break your conversion rate. Think of it like this: It’s your campaign's job to get customers interested in your offer. It’s your website’s job to show them how to acquire said offer. Ask yourself, how easy is it for me to take the action I want my customers to take on my website? 

Bidding Strategies and Quality Score

Google determines what ad placements to give you based on relevance and utility, with a strong score leading to better placements and lower costs. When ads and landing pages are well-aligned, Google increases ad visibility and provides better value, giving your campaigns a greater chance at success!

Budgeting and Ad Placement

Optimizing your ad campaigns (such as appearance frequency, placements and more) is crucial to overall performance. A flexible budget with smart bidding strategies can ensure your ad performs highly during critical moments. For example, ads displayed during high-intent periods (like when a customer is getting ready to purchase) typically outperform those shown during low-intent or off-peak moments (like when a customer sees your business / ad for the first time).

With Google's evolving AI and frequent algorithm changes, expert assistance is the secret sauce to high-performing campaigns! Lucky for you, we here at XMA Agency are happy to give you that assistance! Contact us today and let’s chat about how we can help you!

So, what's a good Google Ads conversion rate? It's not a set number, but rather a moving target that depends on your industry, who you're trying to reach, and how well you keep up with the ever-changing ad world. By knowing how to crunch the numbers and constantly tweaking things like your targeting, ad copy, landing pages, bidding, and budget, you can make sure your campaigns keep delivering awesome results and a sweet ROI. Alternatively, you can let us at XMA worry about that. If you’re interested in seeing how we can help you (and your campaigns) contact us today! If you’d like to learn more about advertising fundamentals, then check out our blog featuring endless articles on all things advertising!