Last updated: April 14, 2026
Most businesses running Google Ads think they know their ROI. They look at their Google Ads dashboard, see a ROAS of 4x or a cost per acquisition of $45, and assume things are going well. But that number is almost always wrong, because it is incomplete.
The dashboard shows what you spent on clicks and what revenue those clicks generated. It does not show what you paid your agency to manage those campaigns. It does not show the hours you spent reviewing reports, approving changes, and sitting in weekly status calls. It does not account for the creative costs, the landing page development, the analytics tools, the call tracking subscriptions, or the opportunity cost of the time your team spends on Google Ads instead of other revenue-generating activities.
When you factor in these hidden costs, most businesses discover that their true Google Ads ROI is 20% to 40% lower than they believed. Some discover they are barely breaking even. A few discover they are actually losing money.
This article explains how to calculate your real Google Ads ROI, provides an interactive calculator you can use right now, and shows you exactly where the hidden costs are eating into your profitability. It also demonstrates something that changes the entire equation: what happens to your ROI when management costs drop from thousands of dollars per month to $79.
The most common mistake in calculating Google Ads ROI is treating "ad spend" as the total cost. It is not. Ad spend is the money you pay Google for clicks. Your total cost of running Google Ads includes everything you spend to make those clicks happen and everything you spend to manage them after they happen.
Agency management fees. If you use an agency to manage your Google Ads, you are paying $1,000 to $10,000 or more per month for that management. In competitive verticals like legal, agencies charge $3,000 to $15,000 per month. This cost must be included in your ROI calculation because it is a direct cost of running Google Ads. If your agency fee is $3,000 per month and your ad spend is $10,000 per month, your actual investment is $13,000, not $10,000. That is a 30% increase in total cost that most ROI calculations ignore.
Self-management time. If you manage your own campaigns, your time is not free. Estimate how many hours per week you or your team spend on Google Ads activities: reviewing performance, adjusting bids, updating ad copy, managing negative keywords, analysing search terms, creating reports, researching competitors. Multiply those hours by your effective hourly rate (salary plus benefits, divided by productive hours). For a marketing manager earning $80,000 per year spending 10 hours per week on Google Ads, the implied management cost is roughly $1,850 per month, or $22,200 per year.
Tool and software subscriptions. Call tracking services ($50 to $300 per month), analytics platforms, bid management tools, landing page builders, competitor intelligence tools. These subscriptions add up, and they only exist because you are running Google Ads.
Creative and landing page costs. Ad copy development, image creation for Display and Demand Gen, video production for YouTube, landing page design and development. Whether you produce these in-house or outsource them, they have a cost.
Reporting and analysis time. The time spent building reports, analysing performance data, preparing for client reviews or internal meetings. Even with automated reporting tools, someone needs to interpret the data and make decisions.
The correct formula for Google Ads ROI is:
True ROI = (Revenue from Google Ads - Total Cost of Google Ads) / Total Cost of Google Ads x 100
Where Total Cost = Ad Spend + Management Fees + Time Cost of Self-Management + Tool Subscriptions + Creative Costs
Most businesses use a simplified version that only includes ad spend:
Simplified ROI = (Revenue from Google Ads - Ad Spend) / Ad Spend x 100
The difference between these two numbers is often shocking. Let us walk through an example.
A business spends $10,000 per month on Google Ads and generates $40,000 in revenue from those campaigns. Using the simplified formula, their ROI appears to be 300%. That sounds excellent.
But add in the full costs: $3,000 per month agency fee, $200 per month in tool subscriptions, $500 per month in creative costs. Their total cost is now $13,700. Their true ROI drops to 192%. That is still profitable, but it is dramatically different from the 300% they thought they were achieving.
Now consider a business where the margins are tighter. $10,000 in ad spend generates $25,000 in revenue. Simplified ROI: 150%. Add $3,000 in agency fees and $500 in other costs: total cost is $13,500, true ROI drops to 85%. Still profitable, but barely, and any performance dip could push them into unprofitable territory.
We have built an interactive calculator that lets you input your specific numbers and see your true ROI in real time. You can access the full interactive calculator below, or use the manual calculation framework that follows if you prefer to run the numbers yourself.
The calculator takes five inputs and produces four key outputs.
Monthly Google Ads spend. The total amount you pay Google each month for clicks and impressions across all your campaigns.
Monthly revenue from Google Ads. The total revenue (or total conversion value) attributable to your Google Ads campaigns each month. If you sell products, this is total sales from Google Ads traffic. If you generate leads, multiply your monthly lead count by your average customer lifetime value and close rate.
Monthly management cost. What you pay an agency, freelancer, or the time value of managing campaigns yourself. If you manage your own campaigns, estimate the hours per week and multiply by your hourly rate.
Monthly tool and software costs. Call tracking, analytics, landing page tools, bid management platforms, and any other subscriptions required for your Google Ads operation.
Monthly creative costs. Ad copy, images, video production, landing page development. Amortise any large one-time costs across the months they serve.
Current true ROI. Your actual return on investment after all costs are factored in. This is the number most businesses have never calculated.
Current true CPA. Your cost per acquisition including all management and overhead costs, not just the CPA Google Ads reports.
Projected ROI with groas. What your ROI would become if management costs dropped to $79 per month. This is not hypothetical. It is the actual cost of groas's autonomous AI management.
Annual savings. The total dollar amount you would save per year by switching from your current management approach to groas, combining reduced management fees with the efficiency improvements from autonomous optimisation.
If you want to run the numbers by hand, here is the step-by-step process.
Step one: add up your total monthly costs. Ad spend plus management fees plus time cost plus tool subscriptions plus creative costs. This is your Total Monthly Investment.
Step two: calculate your current true ROI. Subtract your Total Monthly Investment from your Monthly Revenue, divide by your Total Monthly Investment, and multiply by 100. The result is your true ROI percentage.
Step three: calculate your true CPA. Divide your Total Monthly Investment by your number of monthly conversions (sales, leads, or phone calls).
Step four: calculate your projected ROI with groas. Replace your current management cost with $79. Recalculate your Total Monthly Investment with this new management figure. Then recalculate your ROI using the same formula. The difference between your current true ROI and your projected ROI with groas is the improvement that comes from eliminating management overhead.
Step five: calculate your annual savings. Subtract your projected Total Monthly Investment (with groas) from your current Total Monthly Investment. Multiply by 12. This is your annual savings from reduced management costs alone, before accounting for any performance improvements from autonomous optimisation.
Across all the businesses we have analysed, management costs (agency fees, self-management time, and associated tools) represent between 15% and 40% of the total Google Ads investment. The exact percentage depends on the size of the ad spend and the management model.
For a business spending $5,000 per month on ads with a $2,000 per month agency fee: management represents 29% of the total investment.
For a business spending $10,000 per month on ads with a $3,000 per month agency fee: management represents 23% of total investment.
For a business spending $15,000 per month on ads with a $5,000 per month agency fee: management represents 25% of total investment.
For a business spending $25,000 per month on ads with a $7,500 per month agency fee: management represents 23% of total investment.
For a business spending $50,000 per month on ads with a $10,000 per month agency fee: management represents 17% of total investment.
Now replace each of those agency fees with $79 per month.
For the $5,000 ad spend scenario, management drops from 29% of total investment to 1.6%. True ROI improves dramatically.
For the $10,000 ad spend scenario, management drops from 23% to 0.8%.
For the $15,000 ad spend scenario, management drops from 25% to 0.5%.
The pattern is clear. At every budget level, reducing management costs from thousands of dollars to $79 fundamentally changes the economics of Google Ads. And this is before accounting for the performance improvements that come from autonomous, 24/7 campaign management versus weekly human review cycles.
Some business owners avoid agency costs by managing Google Ads themselves. This appears cheaper, but it hides a significant opportunity cost.
If you are a business owner or marketing director earning a salary, the hours you spend managing Google Ads have a real cost, even if no money leaves your bank account. A marketing director earning $90,000 per year who spends 8 hours per week on Google Ads is investing roughly $1,660 per month in management time. That is money that could be spent on other revenue-generating activities.
More importantly, self-managers almost always under-invest in management. They check search terms once a week instead of daily. They review performance metrics monthly instead of continuously. They respond to Google platform updates weeks or months after they launch. In a high-CPC environment, this under-management creates waste that exceeds the cost of the time invested.
groas eliminates both the direct cost and the opportunity cost. At $79 per month, it costs less than a single hour of a marketing director's time. And it provides 24/7, real-time campaign management that no human, no matter how diligent, can replicate.
This section is specifically for businesses currently working with a Google Ads management agency. The question is not whether your agency is good. Many agencies are competent and deliver real value. The question is whether the cost of that management is justified by the results it produces, relative to what autonomous AI can deliver at a fraction of the price.
Your agency invoice is not the total cost of working with an agency. Factor in these additional costs that agencies create.
Your time in meetings and reviews. Most agencies schedule weekly or bi-weekly calls, plus monthly strategy reviews. Even at 2 hours per week, that is 8 to 10 hours per month of your time spent on agency communication rather than on your business.
Approval bottlenecks. Agencies typically need your approval before making significant changes. This creates delays where campaigns run with suboptimal settings while waiting for you to review and approve recommendations.
Onboarding and transition costs. When you switch agencies (which most businesses do every 18 to 24 months), there is a learning curve where the new agency takes weeks or months to understand your account, during which performance often dips.
Contract lock-in. Many agencies require 3 to 12 month commitments. If performance is poor, you are paying for underperformance during the contract period.
Let us take a concrete example. A business spending $15,000 per month on Google Ads with a $5,000 per month agency generating $55,000 in monthly revenue.
With the agency: Total monthly cost is $20,000 (ad spend plus agency). True ROI is 175%. True CPA including management overhead is significantly higher than the CPA the agency reports (which only includes ad spend). The agency reviews search terms two to three times per week, leaving irrelevant clicks running for days. Campaign changes wait for weekly calls. Google platform updates are implemented weeks after launch.
With groas: Total monthly cost is $15,079 (ad spend plus $79). True ROI jumps to 265%. Annual savings on management alone: $59,052. Search terms are reviewed in real time, with negative keywords added immediately. Campaign changes happen autonomously, 24/7. Google platform updates are implemented on the day they launch.
The ROI difference between 175% and 265% is not a minor improvement. It is the difference between a profitable channel and a channel that transforms your business. And it comes almost entirely from eliminating the management overhead that most businesses accept as a necessary cost of running Google Ads.
Knowing your ROI is useful. Knowing how it compares to industry benchmarks is even more useful. Here is what "good" looks like across major verticals, based on 2025 benchmark data.
Average Google Ads ROAS across ecommerce ranges from 4x to 8x on branded terms and 2x to 4x on non-branded terms. A true ROI (after management costs) of 150% to 300% is considered healthy for most ecommerce businesses. Strong performers achieve 400% or higher. If your ecommerce true ROI is below 100%, your management costs are likely too high relative to your margins.
ROAS in SaaS is harder to measure directly because of long sales cycles and high lifetime values. Cost per lead benchmarks range from $50 to $200, with cost per qualified lead often exceeding $300. True ROI should be calculated against customer lifetime value, not first-month revenue. A healthy SaaS Google Ads operation generates a 3 to 5x return on total investment when measured against 12-month LTV.
As covered in our Google Ads for Lawyers guide, legal has the highest CPCs of any industry. Cost per lead ranges from $200 to $500 or more. However, case values are also extremely high, with personal injury cases potentially worth hundreds of thousands in fees. A true ROI of 200% to 500% is achievable for firms that optimise for case value rather than lead volume.
Cost per patient acquisition in healthcare typically ranges from $100 to $300 through Google Ads. Patient lifetime values of $3,000 to $10,000 make Google Ads highly profitable for most practices, with true ROI commonly between 200% and 400%. Management costs represent a larger proportion of total investment for smaller practices with lower ad budgets.
Plumbers, electricians, HVAC, roofing, and similar home service businesses typically see CPCs of $8 to $50 and cost per lead of $30 to $150. Average job values of $500 to $5,000 make Google Ads a strong channel for most home service businesses. True ROI after management costs commonly ranges from 150% to 350%.
Real estate Google Ads is characterised by high competition but also high transaction values. Cost per lead ranges from $30 to $100, with commission values of $5,000 to $30,000 per closed deal. True ROI is heavily dependent on close rate, with well-optimised campaigns achieving 300% to 800% true ROI.
Across all industries, the single most actionable benchmark is this: what percentage of your total Google Ads investment goes to management versus ad spend? If management costs represent more than 20% of your total investment, you are likely overpaying for management relative to the value it delivers. With groas at $79 per month, management costs drop below 2% for most advertisers, which means over 98% of your investment goes directly toward reaching customers.
The Google Ads industry has operated for two decades on the assumption that effective campaign management requires significant ongoing human investment. Agencies charge thousands per month. In-house teams dedicate hundreds of hours per year. Freelancers bill by the hour or take a percentage of spend.
Autonomous AI management fundamentally disrupts this assumption. When management cost drops from $3,000 to $10,000 per month to $79 per month, the entire economics of Google Ads changes.
Smaller budgets become viable. A business spending $3,000 per month on ads cannot justify a $2,000 per month agency. But they can justify $79 per month for autonomous management. This opens Google Ads as a profitable channel for businesses that were previously priced out of professional management.
Larger budgets become more profitable. A business spending $50,000 per month on ads with $10,000 in agency fees sees their true ROI jump immediately when management costs drop to $79. That $9,921 per month in savings can be reinvested in additional ad spend (generating more revenue), invested in other growth initiatives, or dropped directly to the bottom line.
The break-even point drops dramatically. When management overhead is $5,000 per month, your campaigns need to generate significant revenue just to cover costs. When management overhead is $79, your break-even point is essentially the ad spend itself plus $79. This means campaigns can be profitable at much lower ROAS thresholds.
Performance improves simultaneously. This is the compounding factor that makes autonomous management transformative. You are not just paying less for management. You are getting better management. Real-time search term monitoring, 24/7 bid optimisation, immediate response to Google platform updates, autonomous negative keyword management, and continuous A/B testing of ad copy and landing pages. groas clients consistently see 15% to 25% performance improvements on top of the cost savings, because autonomous AI makes more optimisation decisions per hour than a human manager makes per week.
The combination of lower costs and better performance does not produce a linear improvement. It produces an exponential one. Lower management costs improve ROI. Better management improves conversion rates and reduces waste. Higher conversion rates and less waste generate more revenue from the same ad spend. More revenue from the same spend further improves ROI. The compounding effect explains why groas clients regularly see their true ROI improve by 40% to 60% compared to their previous management approach.
Running the numbers is the first step. Acting on them is what matters. Here is how to use your calculator results productively.
If your true ROI is below 100%, your campaigns are losing money after management costs. This does not necessarily mean Google Ads is wrong for your business. It may mean your management costs are too high, your conversion tracking is incomplete (leading to underreported revenue), your campaigns are poorly optimised, or your landing pages are not converting effectively. Start by addressing management costs (the fastest fix) and conversion tracking accuracy.
If your true ROI is between 100% and 200%, your campaigns are profitable but vulnerable. Any performance dip, CPC increase, or management cost increase could push you into unprofitable territory. Reducing management costs creates a larger margin of safety and makes your Google Ads investment more resilient.
If your true ROI is above 200%, your campaigns are performing well. The opportunity here is to reinvest management savings into additional ad spend. If reducing management costs from $5,000 to $79 saves you $4,921 per month, investing that $4,921 in additional ad spend (at your current ROI) generates significant incremental revenue.
If your projected ROI with groas is significantly higher than your current true ROI, the decision is straightforward. The only question is whether you believe autonomous AI management can deliver the same or better optimisation as your current approach. The evidence, from Google's own data showing AI Max delivering 14% to 27% conversion lifts, from Nielsen's study of over 1 million campaigns confirming AI outperforms manual management, and from groas's own client results, says yes.
How do I calculate Google Ads ROI?
True Google Ads ROI is calculated as: (Revenue from Google Ads minus Total Cost) divided by Total Cost, multiplied by 100. Total Cost must include your ad spend plus all management costs (agency fees or time value of self-management), tool subscriptions (call tracking, analytics, landing page tools), and creative costs (ad copy, images, video, landing pages). Most businesses only include ad spend in this calculation, which overstates their actual ROI by 20% to 40%.
What is a good ROI for Google Ads?
A "good" ROI depends on your industry and margins. Across most industries, a true ROI (including all costs) of 200% or higher is considered healthy. Ecommerce businesses typically target 150% to 300%. Legal services can achieve 200% to 500% due to high case values. SaaS companies should measure against customer lifetime value, targeting 3x to 5x total investment. The critical number is not how your ROI compares to benchmarks but whether it exceeds your break-even threshold, which includes all costs, not just ad spend.
How much should I pay for Google Ads management?
Traditional agency management costs range from $1,000 to $10,000 per month or 15% to 20% of ad spend. Freelancers typically charge $500 to $3,000 per month. In-house management has an implied cost based on salary allocation. Autonomous AI management through groas costs $79 per month. The right question is not how much to pay but what percentage of your total Google Ads investment goes to management. If management exceeds 20% of your total investment, you are likely overpaying relative to the optimisation value received.
Why does my Google Ads dashboard show different ROI than my actual ROI?
Your Google Ads dashboard shows ROAS or conversion value based only on ad spend. It does not include management fees, tool costs, creative costs, or the time value of your involvement. It also uses Google's attribution model, which may differ from your actual revenue data. Additionally, Google Ads tracks conversions based on its own attribution windows and models, which may not match your CRM or accounting data. Always cross-reference Google Ads data with your actual revenue and include all costs for a true ROI figure.
How do agency fees affect my Google Ads ROI?
Agency fees directly reduce ROI by increasing total investment without increasing revenue. A campaign generating $50,000 in revenue on $10,000 in ad spend shows 400% ROAS in the dashboard. Add a $3,000 agency fee: true ROI drops to 285%. Add tool subscriptions and creative costs totalling $500: true ROI drops to 270%. The higher the agency fee relative to ad spend, the greater the impact on true ROI. For businesses with smaller ad budgets ($3,000 to $5,000 per month), agency fees can represent 30% to 40% of total investment, severely compressing profitability.
What management costs should I include in my ROI calculation?
Include all costs that exist because you run Google Ads. This means agency or freelancer fees, hours your team spends on campaign management and strategy (valued at their effective hourly rate), call tracking and analytics tools, landing page builder subscriptions, creative production costs (ad copy, images, video), bid management or optimisation tool subscriptions, and the time you spend in agency calls, reviewing reports, and approving changes. If a cost would disappear if you stopped running Google Ads, it belongs in your ROI calculation.
What is the difference between ROAS and true ROI?
ROAS (Return on Ad Spend) measures revenue divided by ad spend only. It ignores all other costs. True ROI measures net profit from Google Ads divided by total investment, including all costs. ROAS is what your dashboard shows. True ROI is what your business actually earns. For example, a ROAS of 5x (spending $10,000 to generate $50,000) sounds excellent. But if total costs including management are $15,000, your true ROI is 233%, not 400%. The gap between ROAS and true ROI is where management costs hide.
How does groas improve Google Ads ROI compared to an agency?
groas improves ROI through two mechanisms simultaneously. First, it reduces management costs from thousands of dollars per month to $79, immediately improving ROI by eliminating overhead. Second, it improves campaign performance through 24/7 autonomous optimisation: real-time negative keyword management, continuous bid optimisation, immediate response to Google platform updates, and autonomous A/B testing. groas clients typically see 15% to 25% performance improvements combined with 95% or greater reductions in management costs. The net effect is a 40% to 60% improvement in true ROI compared to agency-managed campaigns.
Should I increase my ad spend or reduce management costs first?
Reduce management costs first. Increasing ad spend with high management overhead amplifies both revenue and waste. Reducing management costs improves ROI immediately with zero risk, because you are not changing anything about your campaigns. Once management costs are optimised (ideally at $79 per month with groas), then evaluate whether increasing ad spend makes sense based on your improved ROI figures. The savings from reduced management often provide the budget for a meaningful ad spend increase.
Can I use this calculator for other ad platforms like Meta or Microsoft Ads?
The ROI calculation framework is identical for any advertising platform. The inputs (ad spend, revenue, management costs, tool costs) and the formula apply regardless of whether you are running Google Ads, Meta Ads, Microsoft Ads, or any combination. However, the benchmarks provided in this article are specific to Google Ads. groas currently focuses on Google Ads management, where its autonomous AI agents deliver the deepest optimisation through direct API integration with Google's platform.
