AdWords Benchmark Data Revealed: How Do You Compare?

What’s a good conversion rate? A good clickthrough rate? How do my results compare?

AdWords advertisers often ask these questions, but until now answers have been hard to come by.

Now WordStream has compiled industry benchmarks for search and display advertising by vertical, based on over 2,300 clients’ data for Q2 2015.

Data is limited to US client accounts. Unfortunately, that minimalises the usefulness of the CPC and Cost per Action comparisons for other markets. But not so the average industry Clickthrough Rates and Conversion Rates.

So, what do WordStream’s data tell us?

Interestingly, search ads for dating and personals sites lead in clickthrough rates (at 3.4%), followed by finance and insurance sites (2.65%). That’s well above the average clickthrough rate (for all verticals): 1.91% for search and 0.35% for display. Talking about display, technology sites lead the pack with clickthrough rates averaging 0.84%. Why are tech sites such strong performers in display? The likely answer: in-app ads.

It’s unclear whether WordStream’s benchmarks include or exclude brand keywords. If included, they could significantly skew results.

Data came from 2,367 US-based WordStream client accounts in all verticals (representing $34.4 million in aggregate AdWords spend).

Marketers looking for other benchmark data (such as bounce rates, session durations, and percentage of new users) need only look to Google Analytics’ Benchmarking Reports, of course.

Why should you care?

While we believe that a company’s performance improvements should always be benchmarked against previous results, the average for your industry vertical can provide a useful measure for comparative purposes. For some companies, finding a vertical that’s a good fit to their business can be a challenge, however.

By all means, look to the benchmarking data from WordStream and in Google Analytics to get a sense as to whether you have big issues to deal with, or if you’re already leading the pack. But, as with any data set, averages can be skewed by the best and worst performers. And conversion rate benchmarks beg the question as to how individual advertisers are measuring them; what and how many actions are considered a conversion.

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