Microsoft Advertising for Contractors: Leads at 40% Less Than Google

Most contractors run Google Ads and ignore everything else. That is a defensible strategy when Google is the only game in town. It has not been the only game for years. Microsoft Advertising runs on Bing and its partner network, powers paid placements in ChatGPT web-powered searches, and is used by fewer than 5 percent of home service contractors. Average CPC on Microsoft Advertising across all industries: $1.54. Average CPC on Google for home services alone: $7.85. Average cost per acquisition for home services advertisers on Microsoft: $21.68. The auction is smaller, the competition is thinner, and the audience skews toward exactly the demographic that hires contractors.

Bing processes roughly 12 billion searches per month in the United States. Microsoft’s search audience is 75 percent more likely to own a home than the average internet user. The median household income for Bing users in the U.S. exceeds $75,000. A homeowner searching “furnace repair near me” on Bing has the same job, the same urgency, and the same checkbook as the homeowner running the same search on Google. The contractors on the other side of that Bing query have almost no competition because most contractors never set up the account.

Why the Auction Is So Much Cheaper

Google Ads CPCs are high in home services because the auction is dense. In a competitive market, a dozen contractors bid on the same “AC repair [city]” query and the price climbs. Microsoft’s auction for the identical query might have two or three bidders, most of them running imported Google campaigns they barely manage. Auction mechanics are simple: fewer bidders means lower clearing prices. The homeowner on the other side of the query is the same person, with the same intent. The price difference is not a quality gap. It is a participation gap.

On Google Ads, home services advertisers pay an average of $7.85 per click. On Microsoft Advertising, industry benchmarks put the equivalent CPC at 33 to 40 percent lower for the same query types. For a contractor converting 10 percent of paid clicks into calls, a $7.85 CPC means $78.50 per call on Google. At a 35 percent discount on Microsoft, that same call costs roughly $51. Over 100 leads per month, the savings exceed $2,700 without changing a single thing about your targeting, ad copy, or landing pages.

The ChatGPT Connection

Bing powers ChatGPT’s web search. When a ChatGPT user searches with web access enabled, they see Bing results, including paid placements from Microsoft Advertising. This creates a paid channel into ChatGPT-generated local results that sits entirely separate from the organic strategies contractors use to earn citations. A contractor running Microsoft Advertising campaigns has two paths into ChatGPT local results: organic (through Bing Places listings and website citations) and paid (through Microsoft Advertising placements). A contractor without Microsoft Ads has only the organic path, competing for a fixed number of citation slots against every other local provider.

Paid placement volume in ChatGPT is growing. Campaigns launched today build conversion history and Quality Scores before that volume matures. Accounts that enter a new channel early carry a learning advantage over accounts that catch up later.

The Import: 15 Minutes to Your First Microsoft Campaign

Microsoft Advertising includes a direct import tool that copies your Google Ads campaign structure, including ad groups, keywords, match types, ad copy, sitelink extensions, call extensions, and bid settings, into a new Microsoft account. You do not rebuild campaigns from scratch.

1. Go to ads.microsoft.com and create a free account
2. Navigate to Import, then Import from Google Ads
3. Connect your Google account and select your top one or two Search campaigns
4. Choose Import now and confirm the transfer

Do not import Performance Max campaigns. They do not transfer cleanly to Microsoft’s campaign structure and require manual rebuilding. Import your best-performing Search campaigns only: the ones with established conversion history and tightly-grouped ad groups. Those are the campaigns most likely to perform on Microsoft with minimal adjustment.

Four Settings to Change Before Spending a Dollar

Reduce bids to 70 to 80 percent of your Google levels. Microsoft’s auction is smaller and less competitive. A $12.00 keyword bid imported from Google typically overpays in Microsoft’s auction. Start every keyword at 75 percent of its Google bid and let the algorithm adjust based on performance data. Overbidding in the first week burns budget while the account is still learning.

Install the UET tag and configure conversion tracking before launch. Google conversion tracking does not transfer to Microsoft. Install the Microsoft Advertising Universal Event Tracking tag on your site, then create two conversion actions: phone call clicks with a 60-second minimum duration and form submission completions on your thank-you page. No conversion tracking means no smart bidding optimization. An account spending without conversion data burns budget across every available click type without learning which ones produce calls.

Switch location targeting to physical presence only. Microsoft’s default includes users who searched for your location from anywhere in the country. Set this to “People in your targeted locations” only. The default pulls in someone in Florida searching “HVAC repair Columbus” while researching a relative’s home. That click costs you money and books no jobs.

Disable the Microsoft Audience Network on launch. The Audience Network is Microsoft’s display advertising channel: banner ads on third-party websites. The import tool enables it by default. Turn it off. Audience Network clicks produce CPAs three to five times higher than Search placements for home service contractors. It is a separate channel with separate creative requirements. Run it separately once your Search campaigns are profitable, not as a default add-on to your first Microsoft campaign.

What to Expect in the First 30 Days

Volume will be lower than Google. Microsoft processes fewer searches than Google in every market. A contractor spending $1,000 per month on Google Search should expect to generate $150 to $300 in comparable Microsoft Advertising spend, simply because the search volume is smaller. That is not a problem. It means incremental leads arrive at a lower cost per lead with no additional creative work beyond the initial adjustments above.

Benchmark CPA for home services on Microsoft is $21.68. New accounts typically run higher for the first 30 to 60 days while the algorithm collects conversion data and ad Quality Scores establish themselves. After 15 recorded conversions, switch your campaign bid strategy from Manual CPC to Maximize Conversions. After 30, switch to Target CPA using a target 20 percent above your current actual CPA and let it tighten from there. Smart bidding on Microsoft responds to conversion signals the same way Google’s does: the more data it has, the more precisely it allocates budget toward the patterns that produce real calls.

Three Actions for This Week

1. Create a Microsoft Advertising account and run the import from Google Ads today. Go to ads.microsoft.com, create a free account, and use the Import from Google Ads tool to transfer your top Search campaigns. Do not import Performance Max. Set all bids to 75 percent of their Google levels and uncheck the Audience Network before saving. Do not activate the campaigns yet: conversion tracking must be in place first or the algorithm will spend without direction.
2. Install the UET tag and configure conversion actions before launch. In Microsoft Advertising, go to Tools and then UET tag. Copy the tag code and install it on every page of your site through Google Tag Manager or a direct script in your site header. Then create two conversion actions: phone call clicks with 60-second minimum duration and form submissions on your thank-you page. Verify both are firing using Microsoft’s UET Tag Helper Chrome extension. Activate your campaigns only after both conversions are confirmed working. An account that spends before conversion tracking is verified produces cost data and no lead data, which is useless for optimization.
3. Set a $15 to $20 daily budget and review the search terms report at day 14. At Microsoft’s home services CPA benchmark, a $450 to $600 monthly test budget should generate 20 to 28 tracked leads in 30 days, enough for the algorithm to begin optimizing. At day 14, open your search terms report under Reports and sort by cost descending. Add negatives for any queries a homeowner would not use when looking for your service. That 20-minute check prevents the most common wasted spend during the account learning period and sets up the campaign for better CPA performance in month two.

Microsoft Advertising is not a Google replacement. The volume is too low in most markets for it to be a primary ad channel. It is an incremental lead source at a significantly lower cost per lead, built on the same campaign structure you already manage on Google. The contractors paying $21.68 per lead on Microsoft while paying $53 to $75 per lead on Google are not running a different strategy. They imported their Google campaigns, made four adjustments, and started a second auction where almost nobody else showed up. The first hour of setup is the hardest part. After that, it runs alongside Google with minimal management and produces leads at a price Google’s auction never justified.