How to Calculate Your Google Ads Budget Opportunity

Understanding the total budget opportunity for your Google Ads campaigns is important for maximizing your Search Impression Share (SIS) and outperforming your competition.

Clients often ask us, “How much budget do I need to fully capitalize on my Google Ads opportunities?”, “What should my budget be?”, or “Where should I allocate extra budget towards the end of the year?”

To answer these questions, we’ve developed a tool that helps identify your total spending potential, allowing you to maximize your campaigns and achieve a stronger impression share. However, it’s essential to recognize that two key metrics influence your search impression share in Google Ads, which we’ll explore in detail below.

What is Search Impression Share in Google Ads?

Google Ads has three different metrics that we’ll focus on: Search Impression Share (SIS), Search Impression Share lost due to budget, and Search Impression Share lost due to rank. Both of the “lost-due-to” metrics measure the factors hindering your ability to show up in the search results 100% of the time.

What is Search Impression Share?

Search Impression Share is the percentage of impressions your Google Ads campaigns receive compared to the total number of impressions they were eligible for, based on keyword-to-query matches.

What is Search Impression Share Lost Due to Budget?

Referred to in Google Ads as “Search lost IS (budget),” this metric indicates the percentage of times your paid search ads were not displayed due to an insufficient budget. It is typically calculated at the campaign level.

What is Search Impression Share Lost Due to Rank?

Known in Google Ads as “Search lost IS (rank),” this metric represents the percentage of times your ads were not displayed in search results due to a low ad rank in the ad auction. It's important to consider this metric because simply increasing your budget won't guarantee a 100% search impression share if your ad rank is insufficient.

There are many other metrics focused on impression share, which you can read about here. For this post, we’ll focus on the top three Search Impression Shate (SIS) metrics.

How to Find Total Budget Opportunity for Your Google Ads Search Campaigns?

Understanding your total budget opportunity to minimize lost impressions due to budget constraints is straightforward—it’s all about the math! The calculator I developed analyzes your existing data (we recommend using at least three months' worth) and calculates the incremental budget needed to reduce your impression share lost due to budget to 0%. This tool also estimates the impressions and clicks you can expect from that ad spend, based on your current click-through rate (CTR) and cost-per-click (CPC).

Additionally, the clicks and spend calculated by this tool can be used to estimate conversion-based metrics, such as conversions or revenue, using your average conversion rate (CVR) or return on ad spend (ROAS). However, it’s important to note that there is a point of diminishing returns, which you will need to factor into the calculation. For simplicity, we’ll focus on the total budget opportunity.

You can download the Google Ads budget opportunity calculator for free! Below we’ll walk you through how to ensure the calculator works for you.

So, how do you use the budget calculator?

Step 1: Download Your Google Ads Search Campaign Data

Go to campaigns → “Insights and reports” → “Report Editor” → “Campaign Performance”:

From there, you’ll need to capture Impressions, Clicks, Cost, Search Impression Share %, Search lost IS (budget), and Search lost IS (rank) at the campaign level.

💡 Tip: I recommend keeping the columns in the order mentioned above, as it will make copying and pasting into the budget opportunity calculator much easier.

Step 2: Add Your Downloaded Data to The Budget Opportunity Calculator

In your downloaded template, paste the data into cells under the section called “The Data”, as shown in the example below:

From there, The total and monthly budget, impression, and click opportunity will populate in the second table, as shown below:

We’ve also included an “Overview” tab to simplify the output. This will enable you to understand the total monthly investment to achieve 0% SIS lost due to budget.

📌 In this blog post, we concentrated on using this tool with Google Ads to provide clear examples. However, you can also apply this tool to Microsoft Ads data to gain a comprehensive understanding of maximizing your budget in search campaigns.

How Do I Optimize My Campaigns if I’m Seeing High Lost SIS Due to Rank?

As mentioned earlier in this blog post, it's important to recognize that you may also experience a loss of impression share due to rank. This requires a different set of optimization strategies to achieve 100% SIS on your Google Ads search campaigns.

The Google Ads metric “Search lost IS (rank)” is influenced by two main factors: bids and quality score.

Bids: These are now typically managed by smart bidding strategies. Key levers include max CPCs in a maximize clicks strategy, target CPA in a maximize conversions strategy, or the ROAS set in a target ROAS strategy. Adjusting these to be more or less aggressive based on the data from your click and conversion metrics, along with competitor activity in auction insights, can help reduce lost impression share due to rank.

Quality Score: This is broken down into three components, each reported at the keyword level. Google assigns a quality score (QS) out of 10, and rates each component as “above average,” “average,” or “below average.” The components are:

• Expected Click-Through Rate (CTR): This measures how likely your ad is to be clicked when shown. To improve this, enhance your ad quality to “excellent” by optimizing headlines, descriptions, and paths with unique and relevant copy. Adding more ad assets like call extensions, location extensions, callout extensions, sitelink extensions, and more can also help.

• Ad Relevance: This measures how closely your ad copy matches the search query. Ensure that your top keywords and search queries appear in your headlines and descriptions. Monitor the search queries that trigger your ad variations to ensure you’re bidding on relevant keywords and using those phrases in your ad copy.

• Landing Page Experience: This assesses the relevance and quality of the landing page your ad directs users to. Improve this by aligning the intent between your keywords, ad copy, and landing page copy. Additionally, focus on the technical SEO and user experience (UX) quality of the landing page.

  • For experimenting with landing pages, we recommend incorporating Landing Page Optimization into your strategy. Tools like Unbounce allow you to create customized landing pages that closely match the intent of your keywords and ad experience, and are optimized for conversion.

• If you’re looking for more information on quality score, Google has a great resource on “5 ways to use quality score to improve your performance”.

By fine-tuning these elements, you can reduce the impression share lost due to rank and enhance the overall performance of your Google Ads campaigns.

Wrapping Up

Maximizing your spend opportunity and optimizing campaigns in Google Ads to reduce SIS lost due to rank is key to achieving strong performance from your campaigns, and outranking your competitors in the space.

Remember, while increasing your budget can help reduce lost impressions due to budget constraints, it's equally important to optimize your ad rank by focusing on bids and improving your quality scores. Continuously monitoring and adjusting these factors will ensure you stay competitive and maximize your return on investment.