The short answer
Start with enough to get roughly 30 clicks a week in your area, run it for 60 days without changes, and scale only after you know your cost per lead. For most local services that's a few hundred to a couple thousand dollars a month.
What this means for you
- Budget is set by the price of a click in your industry and area, times how many clicks it takes to get a lead. Both are knowable before you spend a dollar.
- A budget too small to get 100 clicks in a month can't produce enough data to improve. It just burns.
- Management fees and ad spend are separate. Ad money goes to Google; the fee pays for the person making it work.
- The goal of month one is not profit. It's a reliable cost per lead you can decide on.
“How much should I spend?” is the first question every owner asks about Google Ads, and the usual answers (“10% of revenue,” “at least $1,000”) are made up. Here’s how to get to a number from your own business.
Start from what a customer is worth
Think about a typical new customer and what they pay you in the first year. A dentist’s new patient, a lawn service’s annual contract, a roofer’s average job. That number is the ceiling. If a lead costs more than a fraction of it (a third is a comfortable rule), ads won’t be profitable no matter how well they’re run.
Then find out what a click costs
Google’s Keyword Planner shows the going rate for clicks on your services in your area. Prices vary enormously: a few dollars for some home services, well over fifty for legal or medical searches. This is the single most important number and it takes ten minutes to look up.
Estimate your cost per lead
Not every click becomes a lead. On a decent landing page, somewhere around one in ten to one in fifteen will call or fill in a form. So cost per lead is roughly click cost times ten to fifteen. Compare that with your ceiling. That’s your go or no-go.
Size the test
The mistake we see most: a budget so small the account gets a handful of clicks a week. That’s not enough to learn anything, and Google’s system can’t optimize on it either. You want roughly 100 clicks a month as a floor. Click cost times 100 is your minimum monthly spend for a fair test.
Run that for 60 days. Don’t change the budget after a slow week. Don’t pause it because a competitor showed up. The first month is for data, the second for tuning.
Fees versus spend
Ad spend goes directly to Google. A management fee is what you pay a person or agency to build the campaigns, write the ads, fix the landing page, cut the wasted searches, and report on it. Keep those separate in your head and on your invoice. A good manager typically lowers your cost per lead by more than the fee, which is the only reason to hire one.
When to scale
When you have two months of data, a cost per lead comfortably under your ceiling, and the capacity to handle more customers. Then raise the budget in steps, watching whether cost per lead holds. It usually rises a little as you go after harder searches. That’s normal, up to the point it isn’t.
What to do this week
- 01Write down what a new customer is worth to you over a year. That's your ceiling for what a lead can cost.
- 02Use Google's Keyword Planner (free) to see the cost per click for your five main services in your city.
- 03Multiply that click cost by 10 to 15 to estimate a cost per lead. If that's under a third of a customer's value, ads are likely worth testing.
- 04Set a 60-day test budget and commit to leaving it alone. Judge on cost per lead, not on the first two weeks.
