These days marketers and businesses excessively rely on digital marketing to achieve their goals. Finding leads, generating interest, qualifying leads, and ultimately converting them into paying customers – all of it can easily be done online. And pay-per-click (PPC) digital advertising is an efficient way to do so. Brands across the globe invest in comprehensive PPC as it builds brand awareness, drives more web traffic, and produces more high-quality leads.
However, like all other online marketing strategies, it is essential to keep an eye on the results and tweak your PPC campaigns for maximum effectiveness. This also includes knowing that you are getting the expected return on your investment in PPC.
ROI is a critical success metric. Let’s find out how you can calculate the ROI for your PPC campaigns and even improve it.
There are three commonly-used ways to measure PPC ROI/calculate PPC ROI success:
Calculating PPC ROI as part of a PPC campaign management shows its actual effect on your business. At the same time, it is vital to check vanity metrics like clicks and impressions to measure PPC success.
As a marketer, you already know that click costs are just one part of the equation. You also need to factor in a range of other expenses when calculating the total cost of a PPC campaign. Some of these include:
All of these expenses affect your PPC campaigns’ total cost. Next, retrieve the total revenue so you can calculate your ROI.
The simplest formula to calculate ROI is:
(Profit – Cost) / Cost
Generally, advertisers refer to ROAS when they talk about ROI because the difference between the two is whether you consider your business’s cost of carrying out PPC advertising business.
ROAS is calculated as:
(PPC Revenue – PPC Cost) / PPC Cost
The result is written in a percentage form. For instance, if your PPC sales are $1,200, while you paid $600 as PPC click costs, the ROAS will be 100%:
($1200 profit – $600 cost = $600) / $ 600 cost = 1.0 = 100%
The ROAS formula is very straightforward, and you can gauge your overall PPC performance and make optimization easy. ROAS is used in bid optimization algorithms to calculate these bids with the help of the bid management platforms.
The calculation of all possible costs, including those to generate leads and sell products, is still insufficient. PPC helps you maximize your profits bringing in maximum visitors and sales at a reasonable cost.
Conversions are highly dependent on the right keywords being used in ads, getting clicks at a good cost, showing Google ads to searchers, and converting visitors to buyers.
To calculate profit per click/impression, you need extensive data for clicks, impressions, total sale, and total cost. First, calculate the profit by subtracting the total cost from total sales (you can also factor in the overhead costs).
Use this formula to calculate the profit per impressions:
Profit / Impressions
Use this formula to calculate the profit per click:
Profit / Click
With these calculations, you can figure out which metric to go for with the keyword or ad or carry out further testing if the information still seems insufficient.
Digital marketing is tricky because it’s constantly evolving. You have to be on your toes and continuously improve your numbers to stay ahead in the race for PPC and search ad domination.
If you find out that the return on investment Or PPC ROI isn’t as good as you expected or could be better, it’s time to improve your game.
Here are a few ways you can increase your PPC ROI:
It is essential to target the right audience for your ads, regardless of the time you display the Google ads to them. Since audiences differ from another for every ad, there might be Google ads that follow a better trend at a specific time.
Generally, ad networks let users schedule the Google ads for the time and days that best suit their needs. For instance, if a local garment store’s ad performs better during a FIFA game, go ahead and pick the same schedule for all your ads.
PPC ads depend on keywords, even more so than they do on demographics. You can understand the customers’ intent with the keywords they use in search or the websites they visit. You can use this data from online activity and enhance your PPC campaigns’ effectiveness using the exact keyword matches.
The exact keyword match will result in the ad being displayed when that phrase is used without any other words. Since you limit an ad’s reach in this way, you have to make sure you use this approach properly so the people who watch the ad are the ones who will most probably buy your products.
For instance, a car dealer selling a Honda Civic EX must use the exact “honda civic EX price” keyword in their ad. Since this is a particular keyword, anyone who searches for it must be a potential buyer of the car, and as a result, the perfect target audience for your car ad.
Even though you have a target audience base, there will be different groups within them who will respond differently to your ads for several reasons. As a result, it is essential to make multiple campaigns so you can cover all of them.
If you resort to using a single PPC campaign to appeal to all these people, you will have a poor ROI. Marketers should carefully design various ads, considering the kind of consumers who would like to use your products and the type of ad that will best explain their value to them.
A great way to improve your PPC campaigns is through negative keywords. This way, your ad won’t be shown to uninterested or unrelated audiences. For instance, a men’s shoe store should use the negative keyword “women” because why should the business pay for a wasted click or view’?
Similarly, a luxury brand that sells expensive goods should use the negative keywords “cheap,” “sale,” or “affordable” to avoid showing the ad to those who want cheaper or imitation brands.
While getting a click on an ad from a customer is huge, your job doesn’t end over there. Ad clicks aren’t enough to generate revenue, and as a marketer, you can improve your ROI with features like videos on your landing page. This helps to increase conversions of customers who click an ad and get there.
Furthermore, you can test your landing page to see if you can easily convert customers once they arrive. When you design targeted landing pages, you allow users to reach a specific page, depending on the clicked ad.
Marketers using Google AdWords should focus on improving their ad’s Quality Score to increase their ROI. The frequency with which the consumers click on an ad and convert after clicking on it affects the score.
Successful ads give more money to Google, and as a result, high-quality score ads are placed higher. It is best to see your ad’s Quality Scores to observe what aligns the most with your target audience.
It is essential to include keywords in your ad copy and target information to capture your viewer’s attention. These words are the ones they consciously or subconsciously look for in an ad when they scan it.
While it depends on an ad’s format, generally, keywords are bold to make them stand out to increase attention and consequently get people to click on your ad.
You cannot improve your ROI and campaigns unless you thoroughly track their results. You can make variations in an ad or its targeting in several ways to affect outcomes. Try out various combinations and track results to determine which target audience and ad type are the most effective.
For instance, you can use variations like different CTAs or distinct background colors for your PPC advertising.
The PPC return on investment/PPC ROI is an essential measure of success since it shows how well you are doing in your campaigns and how much you need to improve.
There are various ways you can measure the ROI and track their results to figure out how you can improve them to make money on your PPC campaigns. Try different methods and see which one aligns with your audience and ads the most. Stick to it instead of going back and forth to ensure a steady approach.
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Pay-per-click (PPC) remains one of the fastest paths to pipeline, but the economics vary widely by industry and are shifting as AI reshapes the SERP. CPCs are up versus prior years, conversion rates have improved in many categories, and lead quality is increasingly a function of how well advertisers feed first-party data into bidding models.
The table below summarizes 2025 search-PPC benchmarks by sector—CPC, conversion rate (CVR), and cost per lead (CPL)—so you can compare what “good” looks like in your niche and calibrate ROI assumptions.
Use these numbers as directional guardrails, then layer in your own close rates and LTV to get to the only metric that matters: profitable growth.
| Sector | CPC (2025) | CVR (2025) | CPL (2025) | Notes |
|---|---|---|---|---|
| Attorneys & Legal | $8.58 | 5.09% | $131.63 | High LTV offsets cost; intake speed drives ROI. |
| Home Services | $7.85 | 7.33% | $90.92 | Strong local intent; geotargeting and call flows matter. |
| Healthcare (Physicians & Surgeons) | $5.00 | 11.62% | $56.83 | Wide variation by specialty; appointment UX boosts CVR. |
| Real Estate (Agents/Brokerages) | $2.53 | 3.28% | ~$100.48 | Lower CVR keeps CPL high; lean on LSAs/retargeting. |
| B2B / Business Services | $5.58 | 5.14% | $103.54 | Longer funnels—optimize to qualified pipeline value. |
| Restaurants & Food | $2.05 | 7.09% | $30.27 | Efficient lead costs; fast payback with online ordering. |
| Automotive – Repair/Service | $3.90 | 14.67% | $28.50 | Top-tier CVR; excellent for local lead generation. |
In short, AI is changing the way PPC campaign management is occurring, and it's happening FAST.
ROI ≈ (Close-Rate × Avg Customer LTV ÷ CPL) − 1
Example (legal): if close-rate 12% and LTV $6,000 on CPL $132 → ROI ≈ (0.12×6000 / 132) −1 ≈ 4.45x (345% net). Improve any one input (faster intake bumps close-rate; better routing lowers CPL) and ROI jumps. Benchmarks for CPL/CVR above provide solid starting points. LocaliQ
PPC will keep paying when two things are true:
(1) you can convert and qualify leads quickly, and
(2) your bidding models are trained on the outcomes that actually make you money.
As AI compresses differences in targeting, the edge shifts to first-party data, creative velocity, and value-based bidding.
Treat the benchmarks above as starting points, then rebuild your ROI math from the ground up: ROI ≈ (Close Rate × LTV ÷ CPL).
Contact us today for your customized PPC audit to see how we can improve your search engine marketing ad spend.
When you’re running pay-per-click (PPC) ads, it’s easy to assume clicks mean genuine interest, but most car shoppers are just kicking tires online. Seeing your inventory once doesn’t mean they’re ready to buy anytime soon or even at all. If you want to reach the portion of clicks that come from serious buyers, you need to use retargeting.
The reality is that even prospects who intend to buy a car will bounce before contacting you or visiting your lot in person. And if you don’t have a way to keep them aware of your business, when they’re ready to buy, they’ll buy from a competitor. Running retargeted ads will keep your dealership in their awareness even after they bounce.
According to a 2022 Cox Automotive Car Buyer Journey Study, the average person spends more than 14 hours searching for a new car, which includes visiting around 5 websites before making a purchase decision. The sites they visit include automakers, dealers, third-party sites, and pre-owned car lots with online inventory. Your prospects aren’t going to buy right away, so to get the sale you need to reel them back in. If you’re not using retargeting – also called remarketing – in your PPC campaign, you’re missing out on hot leads.
Buying a car isn’t a small decision. People compare makes, models, and deals and look for dealerships with great reputations. Getting a single click from a potential car buyer isn’t enough to make the sale. And when they bounce, there’s no guarantee they’ll remember you exist. You’re paying for all those initial clicks, and if potential leads never come back you’ve wasted your ad spend. When you use retargeting, you’ll have another chance to turn their curiosity into a conversation, and that’s why remarketing is an essential component in every PPC ad campaign.
PPC ad retargeting for car dealerships shows your ads to people who have already clicked on an ad or visited your website. When implemented strategically, it keeps your dealership visible across multiple platforms and follows those people across the web. For example, when you run retargeted ads on the Google Display Network, your display ads will show up on the blogs, news sites, and apps your prospects frequent.
You can also run retargeting campaigns on social media sites like Facebook and Instagram. As long as your prospects scroll through their daily feed, your ads will show up for them if they’ve already interacted with you. YouTube also offers retargeting options with video ads that play right before the content. In fact, don’t underestimate the power of YouTube video advertising. According to data from Wyzowl, video ads convince 84% of people to buy a product or service.
Not everyone searching for a new car will respond to the same bland, boilerplate message. For example, someone browsing luxury SUVs isn’t going to click on an ad that says, “Low APR on all models!” That’s where remarketing shines. It lets you tailor your message to what each user actually wants, which increases response rates.
With retargeting, you can segment your audience based on their interests and behavior. For example, someone comparing financing terms won’t be swayed by flashy sports car imagery. With retargeting, you can show truck shoppers truck ads and sports car shoppers sports car ads. It sounds simple, but it’s one of the most powerful marketing methods of all time. People are far more responsive to messages that feel personal. You may have caught their attention with a general ad at first, but once they start browsing those SUVs on your website, you can retarget them with SUV ads.
When you use retargeting, you can provide different calls to action (CTAs) to users based on how they’ve engaged with your web pages. A visitor who spent a lot of time on your truck inventory pages can be served ads for your latest truck deals. Someone who checked out your lease specials can be hit with ads that talk about financing offers. It’s deceptively simple and brutally effective. Relevance is everything. When your ads reflect what the prospect was already thinking about, it feels personal and resonates.
A next-level tactic is using engagement depth to determine how strong your call to action should be. For instance:
· Multi-page viewers and long dwell times. These are warm leads and can be retargeted with stronger CTAs like “Book a test drive” and “Get a quote today.” They’re close to converting and just need a little push.
· Single-page bouncers. These are people who just peeked at your site. They can be re-engaged with lighter touchpoints like a general promotion or model comparison guide to reel them back in.
· Abandoned lead forms. If someone started filling out a form but didn’t finish, retarget them with a reminder and a stronger offer to sweeten the deal (e.g., “Complete your form for $500 off!”).
This level of nuance turns retargeting into a conversion machine and allows you to show the customer exactly what they want to see.
People don’t buy cars from whatever dealer they find first. That’s too risky. They buy from dealerships they trust and that feel familiar. You can build that sense of familiarity and trust through retargeting. For example:
· Consistent branding across ads. Using consistent branding, design, and messaging throughout your ads reinforces your dealership’s identity.
· Frequency builds familiarity. People need to see a brand between 5-7 times before they’ll remember it. Retargeting puts your dealership in front of people over and over again. Even if they don’t click right away, it’s helping to establish your credibility.
· Social proof works. When you use social proof like customer testimonials or awards in your ads it builds trust with your prospects.
Trust is earned over time, and retargeting will help you get it.
If you’re not using retargeting, your competitors definitely are. Car dealerships operate in one of the most brutally competitive markets out there, with national chains and franchise giants dominating search results and flooding ad channels with endless budgets. If you’re not showing up again and again, your competitors will, and they’ll scoop up all your leads.
The good news is you don’t need a massive marketing budget to get results. Retargeting allows smaller, local dealerships to play smart rather than trying to play big. When you focus on local PPC with hyper-targeted remarketing, you can reach a smaller, more qualified audience – people who are actually in your area, browsing your inventory, and likely to buy soon.
And unlike those cookie-cutter campaigns from national dealers, you can make your messaging feel personal and specific to your local community. That’s an edge big budgets don’t have.
Every visitor who leaves your website without converting is a potential sale but not necessarily lost. With smart retargeting, you can bring them back into your funnel and stay top-of-mind while your competitors waste money shouting into the void. Persistence wins the sale and retargeting is how you stay on the map.
To be blunt, search ads can get expensive fast, especially when clicks can cost a couple dollars per click. Pouring money into cold traffic is gambling on people who may not be ready to engage. Retargeting changes everything.
Display retargeting clicks typically cost a fraction of what you’d pay for search ads using competitive keywords. You’re no longer paying top dollar to get someone’s attention from scratch – you’re nudging people who already know who you are, and those people are more likely to respond. This makes retargeting one of the most cost-effective ways to use your advertising budget.
· Lower CPC, higher intent. Retargeting costs less per click, but you’re targeting people who already visited your site and showed interest.
· Better conversion rates. Familiarity breeds trust. Retargeted visitors are statistically more likely to convert than new users who just clicked an ad out of curiosity.
· Higher ROI. Since retargeting reaches warm leads, the cost of acquiring a lead is usually lower, which means your overall cost per lead is lower and you get better ROI.
If you’re skipping remarketing because you think it’s just something “extra” that doesn’t make a difference, you’re not saving money – you’re losing easy wins. Instead of perpetually chasing new, cold traffic, invest in converting the traffic you’re already getting. That’s exactly what remarketing does.
Generic ads are fine for first impressions, but once someone has browsed your inventory it’s time to get specific with dynamic retargeting. Here’s how it works:
When a prospect views a specific vehicle on your site, you can use retargeting ads to show them the exact vehicles they viewed and others like it down to the year, color, trim, and mileage. For example, if they looked at a black 2005 BMW 535i, that’s exactly what they’ll see in the ad – the same photos, same specs, all across sites like YouTube, Facebook, news platforms, and more. This reminds your prospects of exactly what they want.
Dynamic retargeting works by integrating your live inventory feed with your ad platform, like Google Ads or Meta. This means the vehicles displayed in your ads will always be up to date and won’t feature cars you sold last week.
Beyond personalization, dynamic ads are an incredible tool for creating a sense of urgency:
· Leverage scarcity. With these ads, you can leverage the power of scarcity by stating that your inventory won’t last. Using messages like “Only 1 left” or “Recently reduced” signals that the opportunity won’t last.
· Show what’s popular. If a particular model is getting a lot of views, let your prosects know. People don’t want to miss out on a good deal.
· Trigger action with FOMO. Fear of missing out is real, and when people see the car they want again – with a reminder that it might sell soon – they’re more likely to come in for a test drive.
By using retargeted ads, you can increase conversion rates by up to 200% compared to standard display ads. These ads feel more like a helpful reminder than an outright advertisement.
If you’ve never run paid ads before, it’s easy to assume your only options are basic keyword targeting and generic follow-up ads. But today’s ad platforms give you a buffet of hyper-specific targeting capabilities to fine-tune exactly who sees your ads, where, when, and how.
One of the most effective PPC retargeting tactics for car dealerships is location-based targeting. With radius targeting, you can serve ads to people within a specified distance from your dealership, like within 10-15 miles. These will be prospects who are not only likely to visit your site but could realistically walk into your showroom today. Don’t waste ad spend on clicks from people three states away.
Then there are device-specific campaigns. If your analytics show that 75% or your traffic comes from mobile (this is common), you can launch a mobile-only retargeting campaign with click-to-call buttons, mobile-optimized landing pages, and a map and directions built right into your ads. This will improve the user experience and increase conversion rates.
Timing also matters. When you schedule your ads you can control when they appear. Run them during lunch breaks, in the evenings, or on weekends when people have more time to browse car listings and are more likely to make big purchase decisions.
Other strategic targeting elements include:
· Demographic targeting. You can tailor your messages based on age, income level, and household status. A 25-year-old college grad and a 45-year-old parent are not shopping for the same reasons even though they might buy the same car.
· Behavioral triggers. You can create audiences for your retargeted ads based on repeat visits, clicks, video views, or interaction with a specific feature like a trade-in calculator.
· Lookalike audiences. Build new audiences that resemble your best customers. Platforms like Meta and Google are really good at identifying similar users based on their behavior online.
The bottom line is that retargeting doesn’t have to be broad. With the right strategy, it becomes a smart, cost-effective system for reaching the right prospects at the right time.
Have a sale, lease offer, or year-end clearance? Retargeting can amplify the urgency to act now. By offering short-term discounts and financing deals, you can tap into the urgency people feel when presented with time-sensitive offers. Emphasize the end date using a countdown timer or final deadline to create FOMO (fear of missing out).
With this type of retargeting, you can align your ads with your email messaging to increase conversions even more. For example, if you sent out a promotion to your email list, they’re likely to see your retargeted ads and be reminded of the deal you’re offering.
Retargeting is the PPC secret weapon most car dealerships don’t take advantage of. Using this strategy can make the difference between a one-time curious visitor and a buyer ready to schedule a test drive. If you’re spending money on clicks without retargeting your visitors, you’re wasting your ad spend.
At PPC.co, we specialize in high-performance white label PPC campaigns that include smart retargeting from day one. Whether you’re launching your first campaign or looking to tighten up your existing ad strategy, we can help you capture more leads, drive more traffic, and move cars off your lot. Let’s turn those clicks into closed deals – contact us now to get started.
