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Getting conversions but CPC seems above average and is killing margins. What can I do?
Posted by on October 28, 2025 at 7:10 amBeen running a Search campaign optimised for Conversions for 1 month.
– 48 conversions with $90 AOV = $4,320
– $200/day budget. Actual spend = $4,696
– ROAS = 0.9
– CPC = $3.23 / 1456 clicks
– CTR = 8.67%
– Conversion rate 3.3%
– Abs. top IS = 10.43% / 25.34% lost to budget / 64.23% lost to rank
– 100% exact match kws with daily negative updates.The CTR and conversion rate seems ok, but it doesn't seem feasible to scale this while ROAS is 0.9.
The only other variable seems to be CPC, but I have no idea how to optimise this while smart bidding is on. $3.23 seems high for my keywords which have 'top of page bids' ranging from $0.58-$2.59.
Will the CPC come down over time? The middle of the 'top of page bid' range is $1.50, which would make ROAS ~2.
Should I expand match types to bring down costs?
Should I implement a bid limit or tROAS now or will this just tank conversions?
Or, is this product just not going to be profitable on Google ads on its own and the only option is to increase AOV/LTV? All else equal, a $3 click with 3% conversion rate will never be profitable if your AOV is less than $100.
Maybe I'm wrong about conversion rate and I should try and get this to 6%? 3.3% seems good on the surface but I have no actual benchmark.
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1 Reply
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Whats your quality scores doing and the underlying factors – landing page experience, ad relevance and expected CTR?
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You need to get your conversion rate up. I would focus on AB testing landing pages to get your cost per conversion down.
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