WordStream by LocaliQ’s 2025 benchmarks show nearly 87% of industries saw a year-over-year increase in CPC. The Google Ads average for various industries reached $5.26 per click. The high intent position is high: legal services average $8.58, and the most competitive B2B categories approach or exceed $8 to $9 per click.
This increase reflects structural changes in the way search results pages are designed, how auctions are optimized, and how inactivity is integrated across all paid search accounts. Many remain invisible until a systematic PPC audit reveals them. Protecting the budget you already have – starting with your nominal terms – is where recovery begins.
Here are five trends every marketer needs to understand right now.
What drives your CPC
More advertisers are chasing the same limited inventory
Search advertising, at its core, is an auction. When many advertisers compete for the same keywords, the prices go up. Global PPC spend continues to increase (Quantumrun Research), while clicks available on results pages have not increased at the same rate. More money chasing the same inventory generates higher prices.
The pandemic accelerated this change forever—brands that hadn’t invested heavily in paid search entered Google’s auction and left.
An overview of Google’s AI is in
One of the most consequential structural changes in paid search over the past decade is the SERP itself. Google’s AI Overviews now take up significant space for informational and assessment questions. As they grow in 2024 and 2025, they reduce the number of live and paid items visible above the barn.
Seer Interactive’s latest 2025 analysis of 3,119 search terms at 42 organizations found that paid CTR for queries with AI Overviews dropped 68%—from 19.7% to 6.34%.
The mechanism is straightforward: as the AI Overview takes up more real estate (Skai), fewer paid placements appear above the fold. Sharing an idea is powerful. Automated bidding is very competitive with inventory, and prices are rising.
The nuance: users who click past the AI Overview tend to move forward in the purchase journey. WordStream data shows about 65% of industries saw a higher conversion rate despite increased CPCs. The implication is clear: shift the budget to high-objective transactional queries where AI Overview is least likely, and away from informational queries where it dominates.
Smart bidding makes every auction more valuable
Modern Google Ads campaigns rely heavily on automated bidding strategies, such as conversion optimization or targeted CPA. In line with Google’s Smart Bidding documentation, the system sets an accurate bid for each auction based on predicted conversion probability – prioritizing performance over cost control.
When almost every competitor uses the same logic, it creates a self-reinforcing loop of increasing bid pressure. This is a dynamic market that you cannot reverse — only adapt to.
Unauthorized product bidding increases your costs internally
While you can’t control the platform’s algorithms or the economy at large, one major driver of CPC inflation is within your control.
When your contacts, partners, or competitors bid on trademarked keywords, they enter an auction that should be almost uncontested. Each additional bid increases your branded CPC, and you pay twice: once to create demand, and again when a third party captures that same search further down the funnel.
A combination of results. The AI overview is already compressed by the available click list; Unauthorized product bidding increases the cost of your won inventory.
Finding infringement requires more than a manual SERP search. Unauthorized bidders often use cloaking—geotargeting away from your headquarters or going during the day outside of business hours—to avoid detection. With a self-service platform like Bluepear, you can run 24/7 automated monitoring across search engines, locations, and devices—capturing ad copy and landing page evidence to dispute invalid affiliate commissions and implement trademark guidelines at scale. Fewer bidders on your branded terms means less auction pressure and lower CPCs for traffic you already own. It’s one of the few paid search engines that doesn’t require extensive strategy changes to get going.
What to do about it: three things that are important to marketers
The data points to three key factors that are important as you navigate this area:
- Protect your branded foundation. Branded keywords reflect the demand you’ve already created. Systematically monitor who else is in that auction and eliminate unauthorized bids with automated product protection tools – one of the most advanced actions available right now.
- Anchor development is a cost per acquisition. WordStream 2025 benchmarks show a higher CPC can deliver a higher quality user, lower traffic and lower CPA. The headline CPC number is increasingly a poor proxy for campaign health.
- Build the company’s first data infrastructure. You’re better protected against a steady increase in CPC when your bidding algorithms use high-quality, proprietary conversion signals – reducing reliance on broad audience measurements.
Average CPCs are at their highest levels in years, and that trend is unlikely to reverse. Marketers who manage costs with the greatest success have adapted their strategies accordingly.
Not sure how many unauthorized bidders are currently in your branded auction? Sign up with a promo code BRANDAUDIT: The Bluepear team will deliver a custom audit of your search engine within 48 hours!
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The opinions expressed in this article are those of the sponsors. Search Engine Land does not confirm or deny any of the conclusions given above.
