Google Ads Cost: B2B SaaS Guide for London

Every B2B SaaS founder in London asks the same question: "How much are Google Ads going to cost me?" It's a sensible question on the surface, but honestly, it's also completely the wrong one to be asking. It leads you down a path of chasing cheap clicks and vanity metrics that do absolutley nothing for your bottom line.

The real question, the one that unlocks scalable growth, isn't "How low can my costs go?" but "How high a cost per lead can I afford to pay to acquire a truly great customer?" The answer isn't in a Google Ads report. It's in your own business accounts.

Forget benchmarks. Forget what your mate's e-commerce brand is paying. The London B2B tech scene is a different beast entirely. We're talking about a hyper-competitive market, long sales cycles, and customers that could be worth tens, or even hundreds of thousands of pounds over their lifetime. In this guide, I'm going to walk you through the actual maths of setting a Google Ads budget that isn't just a cost centre, but a predictable revenue engine for your SaaS business. We'll cover the real factors that drive cost in London and give you a framework to build your strategy on solid ground, not guesswork.

So, why is asking for an "average cost" such a trap?

When you ask for an "average," you're looking for a simple answer to a complex problem. And agencies that give you a simple answer, like "oh, clicks for SaaS in London are about £15," are either inexperienced or they're not telling you the whole story. It's a meaningless number because it ignores the variables that actually matter.

Think about it. The cost of a click is determined by an auction. You're bidding against every other company that wants that user's attention. What drives that price up or down?

Competition: London is arguably one of the world's top tech hubs. You've got FinTechs in Canary Wharf, MarTech startups in Shoreditch, and established players all over the city. They're all bidding on the same pool of valuable keywords. More competition means a higher price, simple as that. You're not just bidding against other SaaS companies; you're bidding against consultancies, agencies, and global enterprises with deep pockets.

Keyword Intent: This is probably the biggest factor. Not all keywords are created equal. Someone searching for "what is cloud computing" is just browsing. Someone searching for "aws cost optimisation software" is signalling a specific, urgent, and expensive problem. The second search is infinitly more valuable, and therefore, way more expensive to bid on. Your cost is a direct reflection of the commercial intent behind the search query.

Quality Score: This is Google's way of rewarding you for being relevant. If your ad copy and your landing page are a perfect match for what the user searched for, Google gives you a higher Quality Score. A higher score means you can actually pay *less* per click than a competitor with a massive budget but a sloppy ad setup. We've seen campaigns where improving the landing page experience cut the cost per click in half, without changing bids at all.

Audience Value: Who are you trying to reach? A click from a CTO at a FTSE 100 company is worth a hell of a lot more than a click from a student researching a project. Google's targeting options let you layer on audiences (like company size, industry, etc.), and the more you narrow in on those high-value decision-makers, the more you should be prepared to pay for the priviledge of getting your ad in front of them.

Trying to average all that out is pointless. You need a better model.

The Only Metric That Matters: Calculating Your Customer Lifetime Value (LTV)

Right, so if we're not focusing on CPC, what should we focus on? The answer is your business's own unit economics. Specifically, your Customer Lifetime Value (LTV). This number represents the total profit you can expect to make from a single customer over the entire duration of their relationship with you.

Knowing your LTV is non-negotiable. It's the North Star for all your marketing spend. Without it, you have no way of knowing if paying £20, £50, or even £200 for a lead is a brilliant investment or a catastrophic waste of money. A solid understanding of what a customer is actually worth is central to any discussion around your Google Ads budget for B2B in the UK.

Let's break down the calculation. It's simpler than you might think. You need three bits of information:

1. Average Revenue Per Account (ARPA): How much revenue does a typical customer bring in each month?
2. Gross Margin %: What's your profit margin on that revenue? Don't use 100% of the revenue. You need to account for your cost of goods sold (COGS), which for SaaS includes things like hosting, server costs, and third-party software licences.
3. Monthly Churn Rate %: What percentage of your customers do you lose each month?

The formula looks like this:

LTV = (ARPA * Gross Margin %) / Monthly Churn Rate

For example, let's say your SaaS product has an ARPA of £400, your gross margin is 85%, and your monthly churn is 3%.

LTV = (£400 * 0.85) / 0.03
LTV = £340 / 0.03
LTV = £11,333

In this scenario, each customer you acquire is worth over £11,000 in gross margin to your business. This number changes everything. Suddenly, the idea of spending a few hundred pounds to get a qualified lead doesn't seem so crazy, does it?

To make this easier, I've built a simple calculator for you below. Play around with your own numbers and see what your LTV is. This is the first and most important step to figuring out your Google Ads cost.

From LTV to a Real-World Google Ads Budget

Okay, you've calculated your LTV. Now what? Now you can finally build a budget based on logic instead of fear. The next step is to determine your target Customer Acquisition Cost (CAC).

CAC is simply the total cost of your sales and marketing efforts to acquire a single new customer. For a B2B SaaS company, a healthy and sustainable ratio of LTV to CAC is generally considered to be 3:1 or higher. This means for every £3 you make from a customer over their lifetime, you can afford to spend £1 to acquire them.

Target CAC = LTV / 3

Using our previous example where the LTV was £11,333:

Target CAC = £11,333 / 3 = £3,777

This is your permission to spend. You now know that you can spend up to £3,777 to acquire one new customer and maintain a healthy, profitable business model. This single number is the foundation of your entire London ROI framework for Google Ads.

But we're not done yet. We're running ads to generate leads (like demo requests, trial sign-ups, or content downloads), not to close customers directly from an ad click. So we need to break this down one step further to get our target Cost Per Lead (CPL).

To do this, you need to know your lead-to-customer conversion rate. Let's say your sales team is brilliant, and they close 1 out of every 10 qualified leads they speak to. That's a 10% conversion rate.

Target CPL = Target CAC * Lead-to-Customer Conversion Rate

Target CPL = £3,777 * 0.10 = £377

And there it is. That's your magic number. You can afford to pay up to £377 for a single, qualified lead from Google Ads. Suddenly, that £40 CPC for a high-intent keyword doesn't look so terrifying. If your landing page converts at 5%, you'd need 20 clicks to get one lead. At £40 per click, that's an £800 spend. Too high. But if you can get your landing page to convert at 10%? You only need 10 clicks. That's a £400 CPL - still a bit over, but much closer to your target. This is how you start making strategic decisions, not emotional ones.

So What Should a London B2B SaaS *Actually* Expect to Pay?

Now that you have the framework, we can talk about some real-world numbers. Based on the campaigns we've run for B2B SaaS clients, costs can vary widly. For one medical job matching platform, we managed to reduce their cost per user acquisition from a painful £100 down to just £7. For another B2B software client using Meta Ads, we were getting registrations at $2.38 a pop, but these were for a lower-friction offer than a demo request. We've seen B2B lead costs on LinkedIn for decision makers at around the $22 mark.

For high-intent Google Search campaigns in a competitive London market, it's not unusual to see CPLs in the £150 - £400 range for qualified leads. Some niches are even more expensive. If you're in FinTech and trying to target Heads of Trading at investment banks, your costs will be astronomical, but the potential LTV justifies it.

Here's a rough guide to what you might expect, but please take this with a huge grain of salt. Your own LTV calculation is far more important than this table.

It's also worth noting that costs differ across platforms. While this guide focuses on Google Ads, many B2B SaaS companies wonder about other channels. We've written a detailed comparison on Google Ads vs LinkedIn for the London B2B scene which might be helpful. Google Search typically captures the highest intent, making it the best starting point, but other platforms have their place once you scale.

Your ICP is a Nightmare, Not a Demographic

The fastest way to burn your budget is with lazy targeting. "Companies in the finance sector in London with 100-500 employees" is not a target audience. It's a sterile data point that leads to generic ads that speak to precisely no one.

To really make Google Ads work, you have to stop thinking about demographics and start thinking about pain. Your Ideal Customer Profile (ICP) isn't a job title; it's a specific, urgent, career-threatening nightmare. Your job is to find the keywords that people use when they are living that nightmare.

Let me give you a couple of London-specific examples:

• Lazy ICP: Head of Engineering at a tech company.
• Nightmare ICP: The Head of Engineering at a Series B scale-up in Old Street who just lost their best senior developer because their staging environment is slow and unreliable, and now they're terrified of missing their product roadmap deadlines.

What does this person search for? Not "devops tools". They search for "how to fix slow staging environment", "kubernetes deployment best practices", or maybe even "alternatives to Jenkins". These are the high-intent, problem-solving keywords you need to target.

• Lazy ICP: Head of Compliance at a finance company.
• Nightmare ICP: The Head of Compliance at a challenger bank near Liverpool Street who is facing an upcoming FCA audit and knows their manual transaction monitoring process is not fit for purpose.

What does this person search for? Not "compliance software". They're searching for "automated transaction monitoring systems", "FCA audit preparation checklist", or "AML compliance software for fintech".

When you define your customer by their pain, the keywords reveal themselves. Your ad copy can speak directly to that pain. Your landing page can offer the exact solution they are desperately seeking. This is how you drive up your Quality Score, improve your conversion rates, and ultimately make your target CPL achievable. Understanding this is fundamental, as outlined in our tech founder's guide to Google Ads in London.

The Offer: Why "Request a Demo" Fails in the City

Now we get to the final, and most common, point of failure: the offer. The "Request a Demo" button is probably the most arrogant call to action in B2B marketing. It assumes that your prospect, a busy London decision-maker, has nothing better to do than schedule a 45-minute meeting to be sold to. It's high-friction, low-value, and immediately screams "I want your time before I've given you any value."

Your offer's only job is to provide an "aha!" moment. A moment of undeniable value that makes the prospect sell themselves on your solution. A standard demo rarely achieves this.

SaaS founders have a huge advantage here: the product itself. The gold standard offers are:

• A free trial (no credit card required). Let them use the product. Let them solve a small piece of their problem. Let them experience the transformation.
• A freemium plan. Even better. Let them use a core version of your product forever. When the value is proven, the upgrade becomes a no-brainer.

When the product itself generates Product Qualified Leads (PQLs), your sales process becomes about consultation, not persuasion.

If you're not a pure SaaS play or have a complex setup, you're not off the hook. You must "productise" your expertise. Bottle it up into an asset that delivers instant value. This could be a free, automated audit tool, an interactive calculator, a detailed industry report, or a short video course that solves a very specific problem. Our free strategy session, where we audit failing ad accounts, is our version of this. We solve a small problem for free to earn the right to solve the bigger one.

Improving your offer is the single most powerful lever you have for reducing your CPL. Look at the calculator below. See what happens to your CPL when you manage to double your landing page conversion rate from a measly 2% (a typical "Request a Demo" page) to just 4% by providing a more valuable offer.

Your Recommended Action Plan

We've covered a lot of ground. It might seem complicated, but the logic is straightforward. Forget about "average costs" and build your budget from the ground up, based on your own business economics. To make it simple, I've broken the whole process down into a step-by-step action plan. If you are serious about growing your SaaS in London with Google Ads, this is your roadmap.

I've detailed my main recommendations for you below:

When Does Expert Help Make Sense?

You now have a framework that puts you ahead of 90% of B2B SaaS companies advertising on Google. The logic is sound, but the execution in a market as fierce as London can be incredibly challenging. The difference between a campaign that breaks even and one that delivers a 5x return on investment often comes down to the small details: precise keyword selection, compelling ad copywriting, landing page optimisation, and sophisticated bidding strategies.

Getting it wrong means burning through cash with little to show for it, a mistake a growing SaaS business can't afford. Getting it right means building a predictable pipeline of high-value customers that fuels your growth.

If you've read this far and feel that you understand the strategy but would rather have a specialist team handle the day-to-day execution, that's where we come in. We live and breathe this stuff. Finding the right Google Ads experts in London for B2B SaaS can be the difference-maker.

We offer a completely free, no-obligation strategy session where we'll dive into your specific business, your LTV, and your goals. We'll give you honest feedback on what's achievable and help you build a concrete plan of action. If it seems like a good fit for us to work together, we can discuss that too. If not, you'll walk away with a ton of value and a clearer path forward.

Hope this helps!