Google Ads Budget Math: Set the Right Number Before You Spend a Dollar
Most contractors set their Google Ads budget one of two ways: they pick a number that feels reasonable, or they let the Google Ads setup wizard suggest one without understanding what it implies. Neither approach tells you whether the budget will generate enough leads to be worth running, or how it compares to what a booked job actually earns. This is a math problem with a known formula. The inputs come from your own business. The calculation takes ten minutes. The output tells you the minimum you need to spend to run a campaign that can learn, optimize, and produce consistent results.
Why Picking a Random Budget Fails
Google Ads rewards campaigns that generate consistent conversion volume. The Smart Bidding algorithms that control how Google spends your budget require at least 50 conversions per month to reach the optimization phase. Below that threshold, the algorithm is guessing which clicks to buy. A contractor spending $300/month at $25 cost per click gets 12 clicks per month. At a 5 percent conversion rate, that is less than one lead per month. The algorithm cannot learn from one lead per month. The campaign burns budget without improving, and the contractor concludes Google Ads does not work for their trade.
Overspending creates a different problem. A $5,000/month budget spread across every service the business offers, in a 40-mile radius, using broad match keywords, wastes the majority on irrelevant searches and low-intent clicks. The budget is not the lever. The campaign structure is the lever. Budget is what you feed a correctly built machine.
The Formula
Work backwards from the job, not forwards from a number you are comfortable with.
- Your average job value. Pull three months of invoices and calculate the average revenue per job for the specific service you want to advertise. An HVAC company running an AC repair campaign should use average AC repair revenue, not blended revenue across all jobs.
- Your phone-to-booked-job close rate. If you answer 10 calls and book 6 jobs, your close rate is 60 percent. Most trade contractors run between 50 and 70 percent on inbound calls from paid search.
- Your landing page conversion rate. This is the percentage of people who click your ad and then call or fill out a contact form. Well-built home service landing pages convert at 5 to 12 percent. Generic websites that send traffic to the homepage convert at 2 to 4 percent.
- Your target cost per acquisition (CPA). How much can you pay to get one booked job? A general rule: up to 10 to 15 percent of the job’s value. A $400 average repair job supports $40 to $60 in acquisition cost. A $6,000 system replacement supports $600 to $900.
With those four inputs, the math runs like this:
Clicks needed per booked job: 1 divided by (landing page conversion rate × close rate). At a 7 percent conversion rate and a 60 percent close rate: 1 divided by (0.07 × 0.60) = 24 clicks per booked job.
Required monthly spend: clicks per booked job × CPC × target jobs per month. If your CPC is $35 and you want 8 booked jobs per month: 24 × $35 × 8 = $6,720 per month.
That number is not a suggestion. It is the minimum spend that makes the math work at those inputs. If it exceeds your current budget, the answer is not to reduce the budget and hope. The answer is to narrow the scope: one service, one city, tighter keyword targeting. Run the formula on a smaller campaign first.
Industry CPC Ranges by Trade
Cost per click varies by trade and by market competitiveness. These are ranges observed across U.S. markets in 2026. Rural markets typically run 30 to 50 percent lower. High-competition metros such as Los Angeles, Dallas, Miami, and Chicago run at the upper end or above it.
| Trade | Typical CPC Range | High-Competition Metro |
|---|---|---|
| HVAC | $18 to $65 | $85 and above |
| Plumbing | $15 to $55 | $75 and above |
| Roofing | $12 to $45 | $60 and above |
| Electrical | $12 to $40 | $55 and above |
| Cleaning services | $4 to $15 | $20 and above |
| Landscaping | $5 to $18 | $25 and above |
| Pest control | $8 to $25 | $35 and above |
To get your actual CPC before spending anything: open Google Ads, go to Tools, then Keyword Planner, enter three to five of your target service keywords with your city or zip code, and set the date range to the last 12 months. The planner returns an estimated CPC range for your specific keywords and location. Use the midpoint of that range in your formula.
The Minimum Viable Campaign Budget
Minimum viable means the lowest spend that gives the campaign enough data to optimize. Plan for at least 10 to 15 clicks per day. At $35 CPC, that is $350 to $525 per day, or $10,500 to $15,750 per month for a mid-size metro HVAC campaign on repair and maintenance keywords. At a 7 percent conversion rate and 60 percent close rate, that campaign produces 24 to 36 booked jobs per month and gives Smart Bidding enough signal to function.
If that number is beyond current capacity, narrow the scope before cutting the daily click target. Run one service instead of all services. Target a 10-mile radius instead of your full area. Use exact and phrase match keywords instead of broad match. A $2,000/month campaign targeting emergency plumbing in three adjacent zip codes outperforms a $2,000/month campaign covering all plumbing services across 40 miles. The daily click target stays the same. The scope shrinks to make it achievable.
Three Numbers to Check Every Week
Once the campaign has run for 30 days, track these three metrics weekly:
- Cost per conversion. Google Ads reports this in the Campaigns view. Compare it to your target CPA from the formula. If cost per conversion is $95 against a target of $60, the campaign structure needs fixing before the budget gets raised.
- Conversion rate. Divide total conversions by total clicks for the period. Below 3 percent signals a landing page problem. Between 4 and 8 percent is healthy for home service campaigns. Above 10 percent means the campaign is well-targeted and the page is doing its job.
- Search impression share. Found in the Campaigns tab under Columns, then Competitive Metrics. If impression share is below 40 percent and cost per conversion is on target, the budget is the bottleneck: you are winning the right clicks but running out of money. This is the signal to increase spend, not to rebuild the campaign structure.
The Week-One Plan
- Run the formula today for your highest-value service. Pull 90 days of invoices and calculate average job value for that service. Estimate your close rate. Open Google Keyword Planner and get CPC estimates for your keywords and location. Run the math and write down the monthly budget the formula produces. That is your target, not a guess.
- If you are already running ads, pull your cost per conversion for the last 30 days. Open Google Ads, go to Campaigns, and check the Conv. cost column. Compare it to 10 to 15 percent of your average job value. If cost per conversion exceeds that threshold, fix the structure before adjusting the budget.
- If you are starting from zero, begin with one service and a tight radius. Set your daily budget to deliver 10 to 15 clicks. After two weeks, check impression share. If it is above 80 percent and conversions are healthy, expand the geographic radius before expanding the budget. Saturate a small area before spreading thin across a large one.
Contractors who run Google Ads profitably have done this math. They know what a job is worth, what they can afford to pay to acquire it, and whether the campaign is hitting that target. Match types, ad copy, and landing pages all matter, but none of them fix an underfunded or misdirected budget. Get the number right first. Everything else builds on top of it.