In 2025, search advertising continues to hold its ground as a top-performing channel for small and midsize businesses. A marketing trend survey by Wordstream shows that 76% of SMBs are satisfied with their current search strategies, and nearly half plan to increase their investment this year.
But how does your performance measure up? Is your current investment aligned with market opportunity? As the SERP evolves with features like AI Overviews and multi-placement ads from a single brand, combined with rising media costs, evaluating performance through a competitive lens has never been more critical.
That’s where the 2025 Search Advertising Benchmarks come in.
Analysed with over 16,000 search campaigns across Google and Microsoft Ads, this data spans from April 2024 to March 2025, to deliver a data-driven view of how advertisers in your industry are performing across key metrics like CTR, CPC, CVR, and CPL.
This report will help you validate your performance, identify areas for optimisation, and inform smarter budgeting decisions.
Key Search Advertising Trends: The Big Picture
What’s trending in 2025?
Search ad costs continue to rise in their fifth consecutive year of rising CPCs, but not as sharply as in previous years.
However, the rate of increase in cost per lead (CPL) has moderated compared to the previous year, signaling a more stable paid landscape, especially following the turbulence in organic search performance in 2024.
Here are the key search advertising trends:
Click-Through Rates (CTR)
Click-through rates (CTR) improved overall by 3.74%, though half the industries experienced a decline. Google’s aggressive optimisation of ad placements may be reaching a plateau as paid listings become indistinguishable from organic results.
Cost Per Click (CPC)
Cost per click (CPC) increased for 87% of industries, driven by SERP changes and greater competition. Some sectors, such as Education & Instruction and Beauty & Personal Care, experienced spikes of over 40%. This aligns with growing competition and increasingly dynamic SERPs.
Conversion Rates (CVR)
Conversion rates (CVR) improved for 65% of industries, showing that better targeting and landing pages are paying off. Advertisers are becoming more effective at turning clicks into qualified leads.
Cost Per Lead (CPL)
Cost per lead (CPL) saw only a 5% year-over-year increase, a significant slowdown from the 25% spike seen between 2023 and 2024. Some industries saw dramatic decreases, such as Career & Employment (-46.7%) and Arts & Entertainment (-32.3%).
Bottom Line for Senior Marketers:
Yes, media costs are up, but so is campaign efficiency. CTRs and CVRs are holding strong or improving in many verticals, underscoring that smart optimisation is outperforming cheap clicks.
For CMOs and marketing leaders, the priority in 2025 is clear: focus on value and outcomes, not just efficiency.
Google Ads Benchmarks by Metric
1. Average Click-Through Rate (CTR): 6.66%
CTR reflects how compelling your ads are. High CTR often means better ad targeting and creative.
Top Industries by CTR:
- Arts & Entertainment: 13.10%
- Sports & Recreation: 9.19%
- Shopping, Collectibles & Gifts: 8.92%
Lowest CTRs:
- Dentists & Dental Services: 5.44%
- Automotive – Repair, Service & Parts: 5.56%
- Business Services: 5.56%
💡 Pro Tip: Use keyword refinement and creative optimisation to improve CTR.
2. Average Cost Per Click (CPC): $5.26
CPC directly affects how quickly your budget is spent.
Most Expensive Industries:
- Attorneys & Legal Services: $8.58
- Dentists & Dental Services / Home Improvement: $7.85
- Education & Instruction: $6.23
Most Affordable CPCs:
- Arts & Entertainment: $1.60
- Restaurants & Food: $2.05
- Travel: $2.12
💡Pro Tip: Increase Quality Score and use strategic bidding to lower CPC.
3. Average Conversion Rate (CVR): 7.52%
High CVRs indicate campaigns are attracting high-intent traffic and are optimised for action.
Highest CVRs:
- Automotive – Repair, Services & Parts: 14.67%
- Animals & Pets: 13.07%
- Physicians & Surgeons: 11.62%
Lowest CVRs:
- Finance & Insurance: 2.55%
- Furniture: 2.73%
- Real Estate: 3.28%
💡Pro Tip: Boost conversions with tailored landing pages and persuasive copy.
4. Average Cost Per Lead (CPL): $70.11
CPL is a “money metric” and a key indicator of ROI in search campaigns.
Lowest CPLs:
- Automotive – Repair, Service & Parts: $28.50
- Restaurants & Food / Arts & Entertainment: $30.27
- Animals & Pets: $31.82
Highest CPLs:
- Attorneys & Legal Services: $131.63
- Furniture: $121.51
- Business Services: $103.54
💡Pro Tip: Use conversion tracking and first-party data to refine bidding and lower CPL.
What These Benchmarks Mean for Your Strategy
1. Monitor SERP Changes Closely
- Google now allows multiple ads from the same brand on one SERP.
- Ads are increasingly indistinguishable from organic results.
2. Diversify Campaign Types
- Use Performance Max, Demand Gen, and Shopping Ads to reduce CPCs and reach new segments.
- Don’t rely solely on Search Ads.
3. Structure Campaigns Strategically
- Segment campaigns by location, audience, or product line.
- This enables better budget allocation and performance insights.
4. Refine Targeting Continuously
- Use demographic and behavioural signals.
- Test Custom Audiences, Customer Match, and remarketing.
5. Focus on ROI, Not Just One Metric
- Consider how CTR, CPC, CVR, and CPL interact.
- Adapt campaigns based on seasonality and changing consumer behaviour.
6. Prepare for Rising Competition
- Combat rising CPCs with value-based bidding and conversion optimisation.
- Prioritise lead quality over quantity.
7. Audit Your Account Regularly
- Use frameworks like SWOT analysis or a PPC checklist.
- Stay agile and ready to pivot based on market shifts.
About the Data
This report analysed 16,446 US-based campaigns active between April 1, 2024, and March 31, 2025, across 23 business categories. All figures are reported in USD, and averages are medians to reduce skew from outliers.
Need a fresh perspective? Let’s talk.
At 360 OM, we specialise in helping businesses take their marketing efforts to the next level. Our team stays on top of industry trends, uses data-informed decisions to maximise your ROI, and provides full transparency through comprehensive reports.
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