Will Google Ads be more expensive in 2026? Cost analysis and how to secure your budget

To look to the future, we first need to look back at the past. The data from the last few years is conclusive – in the case of CPC in Google Ads, we are still seeing an upward trend:

• In 2024, the average CPC in Google Ads increased year-on-year for most industries. On average, this was an increase of approximately 10% compared to 2023. (1)
• In some segments, analyses of benchmarks from 2022-2024 show an increase in average CPC of up to 30%. (2)
• This year’s reports also confirm this trend – the average cost per click and cost per lead are rising, although the growth rate is slightly slower than at the turn of 2023 and 2024. (3)

There are several reasons, of course, the most important of which are:

1.  CPC inflation + greater competition for users

The Ads market is growing rapidly. All forecasts point to further global growth in search advertising spending. More and more companies are entering the Google Ads market, and many are also shifting part of their budgets from other marketing activities to paid traffic acquisition. The result? Auctions are becoming more competitive, which naturally increases CPC. The battle for users is becoming increasingly fierce, especially in competitive industries.

2. Automation and Performance Max: less control, different economics

Google is consistently pushing the market towards automation and Performance Max campaigns, mainly through:

• Smart Bidding, tROAS, tCPA,
• broad matching,
• AI Max / advanced automation layers,
• PMax in both classic search results and on YouTube, Display, and Discover channels.

On the one hand, automation can actually be helpful:

• It can improve conversions, which can be a useful feature, especially for those with little experience in campaign optimization.
• It can also optimize your cross-channel budget.
• Automated solutions can identify potential conversion growth that we would not identify manually.

On the other hand, there are also disadvantages to this solution:

• Automation takes away some of the control over bids, which can be challenging, especially for campaigns with a small budget.
• It also increases dependence on data and signal quality – incomplete data can lead to incorrect decisions and budget overspending.
• In many accounts, it results in budget allocation to channels with poorer intent and relevance (e.g., too much YouTube instead of Search).

3. Privacy, Consent Mode v2, and “leaky” data

Since 2024, Consent Mode v2 has been a mandatory standard for advertisers in the European Economic Area and the United Kingdom. All entities that want to use remarketing, conversion tracking, and user behavior tracking on their websites must correctly implement Consent Mode v2.

But what if Consent Mode is not on the website or has been implemented incorrectly?

• For a company, this means no new user data,
• No power for Smart Bidding algorithms,
• Less-accurate conversion modeling makes it difficult to draw reliable conclusions.

4. Change in user behavior (zero-click, AI Search, longer paths)

And the last reason, although in our opinion one of the most important. The development of the AI Search landscape has a significant impact on both SEO and SEM. With the rise in popularity of LLM models and the emergence of new AI-based solutions from Google, some of the traffic is moving to other places:

• AI Overviews / AI Mode in the case of Google,
• generative responses in LLM models,
• comparison engines,
• social media.

This results in:

• SERP is becoming more crowded and less predictable,
• increased pressure on Google Ads activities, as organic search delivers fewer clicks due to so-called zero-click answers,
• conversion paths are becoming longer, more complex, less linear, and more difficult to analyze.

What does this mean in practice? More touchpoints = more paid touchpoints if you don’t have a well-planned strategy.

Of course, it is impossible to say unequivocally by how much CPC will increase next year. As we mentioned, data from the last few years show a relatively stable trend in CPC cost inflation (approx. 4-10% year-on-year), though this varies by industry.

Google Ads campaign costs will likely be higher per click, but it is up to you and your strategy whether they will be more expensive per conversion.

Therefore, in 2026, the following will be key in Ads campaign analytics and planning:

• CPL / CAC, not just CPC,
• ROAS / value-based bidding,
• traffic and lead quality,
• synergy with other channels.

Step 1: Check your CPC and CPL and adjust your budget accordingly.

1. Take into account the average CPC for your campaigns over the last 3-6 months, and estimate the minimum number of clicks required for the algorithm to have a meaningful history and for you to have data to evaluate. Ideally, this should be at least several hundred clicks and a dozen or so conversions.
2. Estimate the target CPL that will be profitable for you, taking into account your margin and LTV.

For example:

• Average CPC: PLN 3.50
• Minimum meaningful volume: 1,000 clicks/month
• Minimum test budget: approx. PLN 3,500/month (only for clicks, no buffer)

If your conversion rate is 3%, then 1,000 clicks = 30 conversions on average.

With this volume:

• The algorithm has material to learn from,
• and you have material to make decisions.

Step 2: Think about your budget annually, not “monthly”

Once you have the above calculations, it’s time to plan your annual budget.

• Add the expected inflation to your minimum budget (we recommend assuming approx. 5-10%).
• In addition, remember to set aside a budget for testing, new campaign types, or new countries if you plan to expand your campaign in 2026.
• Also, take seasonality into account – if you know from experience when your campaigns perform best, prepare a larger budget for that season.

Step 3: Add a buffer for automation testing

If you want to use PMax, tROAS, and new formats in 2026, you will need:

• a testing budget for 2-3 months,
• additional funds for creative assets (video, display),
• room for error (the algorithm will learn from your data, and it is possible that some of your campaigns will not generate high conversions).

• In Q4 2025 and Q1 2026, test the budget floor, i.e., the minimum budget threshold that will be effective and allow algorithms to learn from the collected data.
• Prepare your account for campaign automation.
• Make sure Consent Mode is implemented correctly.
• Clearly define conversions and ensure you collect data on them.
• Check that you have data from GA4, CRM, and Google Ads linked in one place – this is a must-have for good data analysis in 2026.
• Stop planning campaigns for cheap traffic and focus on quality – analyze CPL, CAC, and LTV for individual campaigns,
• Also, think about other advertising channels – test ads on TikTok, Meta, LinkedIn,
• Focus on brand activities to lower CPC per brand.
• In parallel with paid traffic, plan an SEO and AISO strategy to drive traffic from Google at a lower cost.

Based on campaigns run on our clients’ accounts, we have also observed increases in CPC and CPL in recent years, but on well-organized accounts, CPL is growing much more slowly than CPC. Why? The use of thoughtful automation, reliance on better data, and a creative approach allow for optimal use of the campaign budget.

How do we help our clients optimally plan their Ads budget for 2026?

• We develop a realistic budget floor instead of asking, “How much do you have?”
• We verify the implementation of Consent Mode.
• We prepare possible scenarios – what will happen to KPIs if CPC increases by a specific percentage?
• We analyze which campaigns to disable next year and which to scale.
• We manage paid campaigns not only on Google but also across other channels, so customer conversions are not dependent on a single traffic source.

With us, you can plan your Google Ads budget for 2026 based on real data and our many years of experience!

• CPC for Google Ads has grown steadily year-on-year and is likely to continue rising in 2026.
• Incorrectly implemented Consent Mode v2 and incomplete data for analysis make optimization difficult and can lead to overspending on campaign budgets.
• Changes in user behavior on Google Search (AI Search, zero-click answers) mean that more paid touchpoints are needed.
• In 2026, it will be crucial to look at CPL, CAC, LTV, and traffic quality, rather than CPC alone.
• The budget for Ads campaigns in 2026 should account for inflation, seasonality, and a buffer for automation testing. It is also worth planning activities on other channels, including social media and AI-based tools (AISO activities).

Sources:

• https://ppchero.com/why-are-google-ads-cpcs-increasing/
• https://www.hockeystack.com/lab-blog-posts/google-ads-benchmarks-from-2022-to-2024
• https://www.wordstream.com/blog/2025-google-ads-benchmarks