How much should a small service business spend on Google Ads per month?

Work backwards from customer value rather than using a percentage of revenue. Multiply the number of extra customers you want each month by what you can afford to pay to acquire one. For most Australian metro service categories, a practical floor is around A$2,000 to A$3,000 a month in media, because below that there are not enough clicks to learn which keywords work.

What is a good cost per lead for a service business?

There is no universal figure. Divide the gross profit of an average customer by your enquiry-to-customer close rate, then decide what share of that profit you will spend on acquisition. If a customer is worth A$1,500 in gross profit and you close one enquiry in four, spending a third of that profit gives you an affordable cost per lead of about A$125.

Is Google Ads worth it for a small business?

It depends on customer value and whether you can measure booked jobs back to campaigns. If a customer is worth over A$1,000 and you can attribute outcomes, paid search is usually viable. If you cannot yet measure cost per customer, fix measurement first, otherwise you cannot tell which half of the spend is working.

How Much Should You Spend on Google Ads? | Resolved Digital

        Stage 01, Traffic·8 min read
      

How much should you spend on Google Ads?

Every answer you will find online is a percentage of revenue. That is the wrong direction to calculate from. Start with what a customer is worth to you and work backwards.

Tablet and laptop showing channel performance charts beside a notebook and calculator

{{ b.text }}

Written by the Resolved team. Budget setting is one of the five points we cover on a free audit call.

Read next

Stage 04, Tracking

Cost per lead is the number that hides the problem

Stages 01-02

Google Ads or Meta Ads: which works better for service businesses?

Want us to run it with you?

Fifteen minutes, all five points, against your real accounts. Free, and you keep the findings.

Get a Free Audit