As Google users, publishers, and advertisers alike make sense of the brave new world we are all entering now that ads will be a part of AI Mode and expanding their reach in AI Overviews, it sure appears that the tech company is in no hurry to lose its search advertising crown.
And recent numbers back up why advertisers and small businesses in particular continue to pay their respects to the king, with LocaliQ finding the average click-through and conversion rates up YoY, as well as cost per click and cost per lead.
“Search advertising costs have been increasing year over year for the last five years, and our latest data shows this trend continuing,” writes Susie Marino in the Google Ads Benchmarks 2025 report, which looked at more than 16,000 campaigns that ran from April 2024 to March 2025. “However, cost per lead did not increase as drastically in 2025 as it did from 2023 to 2024, suggesting a little more stability in the paid ad space (after an extremely volatile year for organic rankings).”
(Source: WordStream by LocaliQ)
Average CTRs increased by 3.74% YoY to a 6.66% average, while average conversion rates increased by 6.84% YoY to 7.52%, which LocaliQ says “reinforces the effectiveness of search ads in driving leads for businesses.”
“It might seem counterintuitive at first, but to address a low conversion rate, you’ll have to first address your CTRs and CPCs,” writes Marino, adding how 87% of industries saw increased costs per click. “For instance, if you’re getting less clicks at higher costs, it’ll be more difficult to maintain a high conversion rate as your budget stretches to cover what are likely lower-intent clicks.”
“Remember, a click is half the battle when securing a conversion.”
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