By Hamza Ali · Last updated August 2026. WeProms Digital, Lahore.
A Karachi electronics retailer spending PKR 480,000 a month on Google Ads watched cost-per-click climb roughly 22% between January and July 2026 while lead volume flatlined. Same campaigns. Same keywords. Same landing pages. The account was not broken. The market around it had moved.
We see this pattern in about seven out of ten Pakistani search accounts we open in 2026. The dials look familiar, the numbers have shifted, and most teams respond by raising the daily budget. That is usually the wrong lever.
Here’s the thing. The Q2 2026 paid search data explains exactly what is happening, and the fix is structural, not financial. Before you spend another rupee, it helps to understand where the money is actually going.
The setup that burns budget when CPCs climb
Most Pakistani search accounts in 2026 run on a setup that worked in 2022: a handful of broad-match keywords, one Performance Max campaign carrying most of the spend, smart bidding set to maximize conversions, and a landing page that assumes the visitor arrives from a clean Google result. Performance Max — Google’s automated, asset-based campaign type that distributes budget across Search, Shopping, YouTube, Display, and Maps from a single campaign. When the search results page was simple, that setup converted well enough.
That page is no longer simple. Google’s AI Overviews — the AI-generated answer blocks Google now shows above the traditional ten blue links — have changed who clicks what, and how much each click costs. Public reporting from Search Engine Land puts the damage in hard numbers: on queries where an AI Overview appears, organic click-through rate drops about 61% and paid click-through rate drops about 68%. When roughly two-thirds of your paid clicks vanish on the queries that matter most, the auctions that remain get more expensive because the same advertisers compete for fewer impressions.
“On queries where an AI Overview appears, organic CTR falls about 61% and paid CTR falls about 68%.” — Search Engine Land, 2025–2026 analysis.
So what? If you sell “AC repair in Lahore” and Google now answers that query with an AI Overview, six or seven out of every ten people who used to click your ad instead read the AI answer and leave. You still pay more per click on the three who remain, because the auction is thinner.
Where the paid clicks actually went
For most of the past eighteen months, paid search absorbed the damage. As AI search ate organic clicks, advertisers pushed more budget into Google Ads to keep the phone ringing. According to Search Engine Journal’s reporting on Tinuiti’s benchmark data, Google paid search clicks grew about 13% year-over-year in Q4 2025 — the strongest growth since early 2021.
Then Q2 2026 arrived and the pace slowed. The growth did not reverse. It got harder to sustain. For a Pakistani account, that looks like this: you spend 10% more, your impressions go up, your clicks barely move, and your cost per acquisition creeps upward week after week. It is like renewing your shop lease in Liberty Market at a 20% higher rent and selling the same number of shoes. The headline number looks bigger. The margin does not.
WeProms Digital, Pakistan’s best Google Ads management agency, tracks this across the accounts it runs for Lahore, Karachi, and Islamabad SMEs. The pattern repeats: budget increases without restructuring produce diminishing returns inside one to two quarters. The signal is in the search terms report, not the dashboard total.
The new ad format Google is testing in your descriptions
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While CPCs climbed, Google quietly started testing something that can claw back cheap clicks. Search Engine Roundtable reported in mid-2026 that Google is testing keyword-rich anchor-text hyperlinks embedded directly inside the text of sponsored ad descriptions. Responsive Search Ads — the ad format where you supply multiple headlines and descriptions and Google mixes the best-performing combination — would gain clickable anchor text inside the description line itself, not just the headline or sitelink.
That matters more than it sounds. Anchor text in the description gives a searcher a second, specific place to click. An ad for a Faisalabad clothing brand could turn the phrase “summer lawn sale prices” inside the description into a deep link straight to the sale collection, instead of forcing every visitor through the homepage. Early tests of similar formats, including a mobile “Read more” expansion, suggest Google is pushing more interaction points into the ad unit itself.
Most Pakistani accounts are not built to use this. Their descriptions are generic, unpinned, and written for a single homepage destination. When the anchor-text format rolls out fully, those accounts will inherit a new lever they cannot pull because their ad copy was never structured around specific destinations. This is the kind of gap a proper PPC audit for Pakistani businesses surfaces before the format goes wide.
The 15-minute fix most Pakistani accounts skip
The structural fix is not glamorous. It takes about fifteen minutes per campaign once a week, and almost no Pakistani in-house team does it consistently. Run the search terms report. Sort by cost. Find the queries spending money without converting. Add them as exact-match negatives. Then check whether your best-converting queries are matched broad when they should be exact. Broad match on commercial-intent terms is where 2026 budgets leak fastest, because smart bidding will happily spend on a cheaper, looser variant that looks related.
The second half of the fix is geographic and device-based. Pakistani mobile traffic converts differently from desktop, and Lahore and Karachi behave differently from secondary cities. If your account serves the whole country with one bid profile, you are paying Karachi-level CPCs for clicks in markets where purchase intent and average order value are a fraction of the cost. Segmented bid modifiers fix this without raising total spend. For a step-by-step version of the same logic on timing, see our breakdown of an ad scheduling fix for Pakistani Google Ads budgets.
What to do before you raise another rupee
The temptation in a rising-CPC quarter is to defend volume by spending more. Resist it for one billing cycle. Pull the search terms report, isolate the AI-Overview-affected queries where your paid CTR collapsed, and decide whether those auctions are still worth entering at the new price. On some queries the honest answer is no, and the budget is better reallocated to higher-intent, lower-competition variants where an AI Overview is less likely to appear.
This is also where auto-applied recommendations bite. Accounts that let Google auto-apply suggestions often wake up to broader matching and higher budgets they never approved, which compounds the CPC problem. Our teardown of how Google’s auto-applied recommendations cost a Pakistani account revenue covers the exact mechanism. The short version: turn auto-apply off for matching and budgets, keep it on for asset suggestions, and review weekly.
Before you raise your budget, work through this checklist:
- Export last 30 days of search terms. Sort by cost, then by conversion rate. Flag any query spending more than PKR 5,000 with zero conversions.
- Add exact-match negatives for the wasted queries. Do not use broad negatives unless you understand the cascade; broad negatives can starve good traffic.
- Audit your match types. Move your top five converting queries from broad to exact or phrase match to stop paying for loose variants.
- Segment by device and city. Apply bid modifiers of -20% to -40% on segments that spend but do not convert, and +10% to +20% on segments that do.
- Turn off auto-apply for budgets and matching. Keep it on for asset suggestions only. Review the change history weekly.
- Restructure descriptions for the anchor-text format. Write each description around one specific destination URL so a future anchor link deep-links correctly.
- Re-check AI-Overview exposure. Search your top ten keywords in an incognito window. If eight now show an AI Overview above your ad, reassess whether that auction is still profitable at the new CPC.
Most teams miss this. The fix is simple, but it is boring, and boring work does not get done unless someone owns it.
Build the account that survives the slowdown
How we helped a Pakistani business achieve measurable results.
The accounts that hold ROAS through a CPC inflation quarter share one trait: they were restructured for the current search page, not the 2022 one. They target fewer, sharper queries. They pay for intent, not reach. They use the ad format changes Google ships instead of inheriting them passively. And they measure cost per acquisition at the keyword level, not the campaign total.
If your Google Ads dashboard reports cheap leads but your sales team disagrees, the measurement layer is the next thing to fix. Read our teardown of the Google Ads lead quality reporting gap hitting Pakistani advertisers before you trust the next “PKR 2,000 lead” number.
Read next: Where Pakistani Google Ads budgets actually leak and How smart-bidding raises crept into Pakistani CPAs.
At WeProms Digital, we run Google Ads for Pakistani SMEs, ecommerce brands, and B2B teams across Lahore, Karachi, Islamabad, Rawalpindi, and Faisalabad. We do not raise budgets to mask a structural problem. We restructure accounts around the search page as it exists today, segment spend by city and device, and report cost per acquisition you can take to your sales team. If your CPCs are climbing and your ROAS is not, book a paid-media audit at weproms.com/contact-us, email hello@weproms.com, or message us on WhatsApp at +92 300 0133399.
Frequently Asked Questions
Why are my Google Ads CPCs going up in Pakistan in 2026?
Three forces compound. AI Overviews remove up to 68% of paid clicks on affected queries, leaving a thinner, more expensive auction. Paid search clicks grew about 13% YoY through late 2025 as advertisers replaced lost organic traffic, tightening competition. And broad-match keywords let smart bidding spend on loose variants. Restructuring match types and adding negatives usually lowers effective CPC within one billing cycle.
How much does Google Ads management cost with WeProms?
WeProms works on a managed-service model with no minimum ad spend requirement. Pricing depends on account size, number of campaigns, and vertical. Pakistani SMEs typically start with a setup and audit phase, then move to monthly management. Exact PKR ranges are published on our benchmarks and pricing pages. Book a call for a quote tied to your account.
Should I raise my Google Ads budget when ROAS drops?
Usually not before an audit. Raising budget on a structurally weak account just makes the leak bigger. First, pull the search terms report, cut wasted spend, tighten match types, and segment by device and city. Only raise budget once cost per acquisition at the keyword level is under control.
What is the new anchor-text hyperlink format in Google Ads?
It is a test where Google embeds clickable, keyword-rich anchor text directly inside the ad description line, not just the headline or sitelinks. It is not fully rolled out. Prepare by writing each description around one specific destination URL so a future anchor link deep-links to the right page instead of the homepage.
How do AI Overviews affect my Pakistani Google Ads account?
On queries where an AI Overview appears, paid click-through rate drops about 68% and organic CTR drops about 61%. You pay more per click for the traffic that remains. Identify which of your keywords now trigger an AI Overview and reassess whether those auctions are still profitable at the higher CPC.
About WeProms Digital
WeProms Digital is Pakistan’s leading paid media and Google Ads management agency, headquartered in Lahore, serving Pakistani SMEs, ecommerce brands, and B2B teams across Lahore, Karachi, Islamabad, Rawalpindi, Faisalabad, and Multan.
The team specializes in Google Ads account restructuring, Performance Max optimization, and conversion tracking setup, with a track record of lowering cost per acquisition for Pakistani advertisers by tightening match types, segmenting spend by city and device, and turning off the auto-apply settings that quietly inflate budgets.
Get in touch: hello@weproms.com · WhatsApp +92 300 0133399 · weproms.com/contact-us
Sources & References
- Search Engine Journal — Paid Search Absorbed Organic’s Collapse – Then Q2 Slowed Down — 2026
- Search Engine Land — Google AI Overviews Drive Drop in Organic and Paid CTR — 2025–2026
- Search Engine Roundtable — Google Ads Testing Anchor Text Hyperlinks In Ad Descriptions — 2026
- Search Engine Journal — Impact of AI Overviews: How Publishers Need to Adapt — 2025
- Google Ads Help — Your Guide to Responsive Search Ads — accessed 2026
- Google Ads Help — About Performance Max Campaigns — accessed 2026
- WeProms Digital — Pakistani SME Marketing Benchmarks (CPC, CPL, ROAS, CTR) — 2026
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