How to Tell If Your Google Ads Agency Is Wasting Your Money

A $6,000-per-month Google Ads account is hemorrhaging $900 a month on keywords that don't convert. The agency managing it says the account is "performing well." They're not lying—they're just not looking hard enough.

Most small-to-mid-size business owners don't have time to become Google Ads experts. But you don't need to be one to spot basic waste. You just need to know where to look.

1. Pull a Search Terms Report and Look for Obvious Garbage

This is the fastest way to spot money bleeding out.

1. Log into Google Ads.
2. Go to Keywords > Search Terms (this shows the actual searches people typed that triggered your ads).
3. Set the date range to the last 90 days.
4. Sort by Cost (highest first).
5. Scan the top 20-30 rows. Are there searches that make no sense for your business?

What to look for: A plumbing company paying for searches like "plumber salary," "plumbing schools near me," or "how to fix a leaky faucet yourself." A dentist paying for "teeth whitening at home" or "toothache remedies." A B2B software company paying for "free alternatives to [your product]." These searches cost money but almost never convert.

If you find 10+ wasted searches, multiply the Cost column for those terms. That's real money walking out the door.

What it means: Agencies often say they use negative keywords to block these. They do—eventually, sometimes. But if search-term reports are piling up with obvious non-intent keywords, the account isn't being reviewed regularly. That's a process failure, and it compounds over time.

2. Check When Negative Keywords Were Last Added

Negative keywords are the brakes on a Google Ads account. They tell Google "don't show my ad for these words." If they haven't been updated in months, the account is probably leaking spend.

1. Go to Keywords > Negative Keywords.
2. Look at the Last modified date for your negative keyword lists.
3. Check when items were last added or modified.

What to look for: If the last modification was more than 90 days ago, no one is actively managing this account. Even in a "steady-state" account, you should see negative keywords added or reviewed at least quarterly—ideally monthly.

What it means: If your agency is actively monitoring, they're pulling search-term reports regularly, finding junk, and blocking it. If negative keywords haven't been touched in six months, the search-term monitoring isn't happening.

3. Audit Your Quality Scores

Quality Score is a 1-10 rating Google assigns to each keyword based on how relevant your ad and landing page are. Lower scores (1-3) cost you more per click. Higher scores (8-10) cost less.

1. Go to Keywords.
2. Select the Columns button (top right).
3. Add "Quality Score" if it's not already visible.
4. Sort by Quality Score (lowest first).
5. Count how many keywords have scores of 1-3. Divide by your total keyword count to get a percentage.

What to look for: More than 20% of your keywords with Quality Scores of 1-3 is a problem. It means you're overpaying for a lot of clicks.

Example: In a 200-keyword account, if 50 keywords have Quality Scores of 1-2, you might be paying $0.80-$1.20 per click when you could be paying $0.40-$0.60 if those scores were 7+. That's a hidden monthly cost of $300-$500, easy.

A low Quality Score usually means the ad copy doesn't match the keyword, or the landing page doesn't match the ad. Both are fixable. If your agency isn't fixing them, that's a gap.

4. Check Conversion Tracking—Is It Actually Set Up?

You can't tell if Google Ads is working if you don't measure what matters. Agencies sometimes set up tracking haphazardly or not at all.

1. Go to Tools & Settings > Conversions.
2. Look at the list of conversion actions.
3. For each one, click it and check:

- Status: Is it "Active" or "Recording conversions"? - Last 7 days: Does it show conversions coming through? (It should say something like "123 conversions in the last 7 days.")

What to look for: Conversion actions with zero conversions in 30+ days are either broken or misconfigured. Specifically:

• If you have a "Contact Form" conversion and it's showing zero conversions for two months, but you know you're getting leads, the tracking is broken.
• If you have conversions flowing in, make sure they match what you care about. (Do you care about all form submissions, or only qualified sales calls? Are those being tracked separately?)

What it means: If conversions aren't tracked correctly, your agency is flying blind. They may be optimizing to the wrong metric, or they may report inflated performance because the data is wrong. In one example, a home services company had a "contact form" conversion set up, but it was firing on unqualified spam submissions. The agency reported a 12% conversion rate when the actual rate was closer to 2%. The client paid for wasted clicks all year.

5. Look at Ad Scheduling (Are You Paying for Off-Hours?)

If your business is only open 9-5 on weekdays, why are you paying for clicks at 2 a.m. on Sundays?

1. Go to any campaign.
2. Click Ad Schedule.
3. Look at the schedule set there. If it's blank or says "All hours," keep going.
4. Check your campaign settings to see if day/hour targeting is active.

What to look for: If there's no ad schedule set, Google is showing your ads 24/7. For a local service business, that's wasteful. A typical example: a plumbing company gets 40% of clicks between 10 p.m. and 6 a.m., when customers can't actually call in. That's $2,400/month wasted on a $6,000 budget.

Some ad scheduling is reasonable (emergency plumbers run at night). But if your business has clear off-hours with no business value, clicks then are waste.

6. Compare Your Cost Per Conversion to Industry Benchmarks

You probably don't know what a "good" cost per conversion is for your industry. That's okay—you can look it up.

1. Go to Campaigns.
2. Add the column Conv. rate (Conversion Rate) and Cost / Conv. to your view.
3. Write down your average Cost Per Conversion across all campaigns.
4. Search online for "[your industry] google ads cost per conversion benchmark" or check reports from Wordstream or HubSpot.

What to look for: If your cost per conversion is 30-50% higher than industry average, that's worth investigating. It may mean your account is poorly structured, or your Quality Scores are low, or you're targeting the wrong keywords.

What it means: This one is trickier—sometimes a higher cost per conversion is justified (you're in a competitive market, or your product is high-value). But if you're paying $150 per lead and your competitors are paying $60, something is wrong.

What to Do With What You Find

If you spot obvious waste in checks 1-3, schedule a meeting with your agency and ask about it directly. Bring the evidence: "I found 15 search terms costing $340 last month that don't match our business. Why?" Good agencies will have an explanation and a plan to fix it. Bad ones will deflect or blame the algorithm.

If checks 4-6 reveal gaps, push back harder. Conversion tracking is non-negotiable. Ad scheduling should be intentional. Cost per conversion should be in the ballpark.

You don't need to become a Google Ads expert to know when your money is being wasted. These six checks take less than an hour and can reveal hundreds or thousands of dollars in monthly overspend. If your agency can't explain the waste, or if nothing improves after you ask, you have your answer.