How Much Should You Budget for Facebook and Google Ads? A 2025 Guide for Business Owners

In today’s competitive digital marketplace, one of the most common—and important—questions Australian business owners ask is: How much should I budget for Facebook and Google Ads?  With digital advertising spend on the rise and platforms evolving rapidly, knowing where to start and how to maximise your return on investment (ROI) is crucial for sustainable growth.

Understanding Digital Ad Costs in Australia

Let’s break down the current landscape for both Facebook and Google Ads, and explore how to set an effective, flexible budget tailored to your goals. Keep in mind , these costs are averages and are correct at time of writing - July 2025. But, things change!

Facebook Ads: What Should You Expect to Spend?

Facebook remains a powerhouse for targeted advertising, but costs can vary significantly by industry, campaign objective, and audience targeting.

Average Costs in 2025:

• Cost-per-click (CPC): Around AUD $2.10

• Cost-per-thousand-impressions (CPM): AUD $11–$13

• Cost-per-lead (CPL): AUD $10–$33, depending on your industry and campaign type

Recommended Budgets:

• Basic campaigns (awareness, local promotions): $300–$500/month

• Intermediate campaigns (lead generation, retargeting): $500–$1,500/month

• Advanced campaigns (e-commerce, nationwide): $1,500–$5,000/month

• For more robust, multi-campaign efforts, many agencies suggest a minimum of $1,500/month to allow for testing, optimisation, and scaling

  
  

Factors Influencing Your Facebook Ad Costs:

• Industry competition: Sectors like e-commerce, finance, and skincare see higher CPCs and CPMs.

• Audience targeting: Narrow, high-intent audiences cost more per click but deliver better leads.

• Ad quality: Engaging, relevant ads lower your costs and improve performance6

• Campaign objectives: Video views are generally cheaper than lead generation or conversion campaigns.

Google Ads: Setting Your Budget for Search and Display

Google Ads offer access to high-intent searchers, but costs are equally variable.

Average Costs in 2025:

• Cost-per-click (CPC): AUD $2–$4 for Search, $1–$2 for Display.

• Monthly spend: Most businesses invest between $1,000 and $20,000/month, with small businesses often starting at $1,000–$2,000/month.

Key Budgeting Considerations:

• Industry and keyword competition: Highly competitive sectors (e.g., legal, finance) may see CPCs above $10.

• Campaign objectives: More competitive goals (like direct sales) require higher budgets.

• Ad quality and relevance: Well-optimised ads and landing pages lower your CPC and boost RO.

• Ongoing optimisation: Regularly refine keywords, bids, and ad copy to maximise results.

What’s your biggest challenge when budgeting for Facebook and Google Ads?

• 0%Knowing how much to spend
• 0%Measuring ROI effectively
• 0%Managing ongoing optimisation
• 0%Competing in a crowded market

You can vote for more than one answer.

How to Set an Effective, Flexible Ad Budget

1. Start Small and Scale:

   Begin with a modest daily or monthly budget (e.g., $10–$30/day for Facebook, $1,000–$2,000/month for Google). Use this phase to test creatives, audiences, and keywords, then increase spend on what works.

2. Align Budget to Goals:

   • Brand awareness: Lower daily budgets, broader reach.

   • Lead generation or sales: Higher daily budgets, more targeted audiences, and retargeting.

3. Allocate for Retargeting:

   Dedicate 20–30% of your budget to retargeting campaigns—these often yield higher ROI by focusing on users already interested in your business.

4. Monitor and Optimise:

   Use platform analytics to track CPC, CPM, cost per lead, and ROAS (return on ad spend). Adjust bids, targeting, and creative regularly for best results.

5. Consider Seasonality and Competition:

   Costs rise during peak retail periods and in highly competitive industries—plan your budget accordingly.

ROI Expectations: What’s Realistic?

• Facebook: A strong campaign can deliver a ROAS (return on ad spend) of 4X or more, but this varies by industry and campaign quality.

• Google: Search campaigns often yield higher conversion rates, especially for high-intent keywords, but require ongoing management to stay cost-effective.

Our Take: Budgeting for Success in 2025

Digital advertising is not a set-and-forget investment. The most successful Australian businesses treat their Facebook and Google Ads budgets as living, breathing tools—starting small, testing relentlessly, and scaling up what delivers results. Flexibility, data-driven optimisation, and a willingness to adapt are your keys to maximising ROI in Australia’s competitive digital market.

Opinion:

The businesses that thrive with Facebook and Google Ads are those that view their ad budget as an investment in learning, not just leads. By starting small, optimising constantly, and scaling up with confidence, you’ll unlock the real power of digital advertising in Australia.