A sustainable cost per lead depends on the money left after delivering a job, overheads, your profit target and your close rate. Revenue per lead is not an advertising budget.
- Cost per lead is ad spend divided by genuine enquiries. Count wrong-suburb calls or job seekers and the number flatters you.
- Illustration: $600 revenue less $360 job costs, $90 overhead and $60 profit leaves $90 per job, or $30 per lead at a one-third close rate.
- Two sparkies can run identical ads and have different good numbers, because urgency, job size and city bidding all move the maths.
- Cost per booked job is the truer test. A lead is only a maybe, and the fastest way to improve it is answering the phone.
- Inflated costs trace to the same leaks: no negative keywords, ads landing on a slow homepage, no tracking, or targeting outside your area.
Keep asking about it in
Quick answer: a good cost per lead fits inside the money your jobs leave for winning new work. Start with revenue excluding GST, take out delivery costs, overheads and the profit you want to keep, then apply your enquiry-to-job close rate. Include management fees and other acquisition costs before deciding what you can spend on ads. Revenue per lead alone cannot tell you whether the campaign makes money.
What cost per lead actually means
Cost per lead is simple arithmetic: what you spent on ads, divided by the enquiries those ads produced. Spend $1,000 in a month and get ten enquiries, and each one cost you $100.
The trap is in what you count as a lead. A call from someone in a suburb you do not service is not a lead. Neither is a job seeker, or a form fill that never answers the phone. If those get counted, your cost per lead looks better than it is. Real tracking counts genuine enquiries only, which is why the same report can flatter one account and tell the truth in another.
Why nobody can quote you a universal number
Two electricians can run the same ads and have completely different “good” numbers.
- An emergency plumber doing after-hours burst pipes has high-value urgent jobs, so they can pay more per lead and still win.
- A sparky doing small residential jobs has less room, so the same cost per lead that works for the plumber would eat their margin.
- A big city with heavy bidding costs more per click than a regional town, before either business changes anything.
What a lead is worth also depends on charging properly in the first place. Published rates for fourteen trades, with call-out fees and award floors, are in our Australian tradie rates and benchmarks dataset.
So when an agency promises “leads for $X” before looking at your trade, your area and your jobs, treat it the way you would treat a customer asking you to quote a bathroom over the phone, sight unseen.
Work it out backwards from your own jobs
Here is an illustrative budget, not a client result or an industry benchmark. Use the same GST basis for revenue and costs; the figures below exclude GST and assume any applicable credits have been accounted for.
- A completed job brings in $600.
- Labour, materials and other direct delivery costs total $360, leaving $240 contribution before overheads and acquisition.
- Allow $90 for overheads and retain $60 profit. That leaves $90 per booked job for acquiring the work.
- If one in three qualified enquiries becomes a paid job, the acquisition allowance is $90 × 1/3 = $30 per lead.
That $30 has to cover both ad spend and the share of management, tracking and other acquisition costs attributable to each lead. For example, if those other costs average $10 per lead, the media budget is $20 per lead. Avoid counting a cost twice if you already included it in overheads.
The same job has $200 of expected revenue per lead ($600 × 1/3). Spending close to $200 to win that lead would consume the money needed to do the work. Bigger jobs only support a higher lead budget when their contribution and close rate support it. Check the assumptions against completed, paid work and update them when your costs or job mix change.
The number above cost per lead
A lead is a maybe. It becomes money when it turns into a booked job, and plenty can go wrong between the two. Leads that ring out. Quotes that never get sent. Enquiries answered two days later, after someone else already got the job.
That is why cost per booked job is the truer test of an ad account, and it is the one we report on. It also explains a pattern we see often: the fastest way to improve your cost per booked job is not cheaper clicks, it is answering the phone. A missed call is a lead you paid for, handed to the next tradie on the list. We cover what that habit costs, and the fix, on our missed call text back for tradies page.
How to bring your cost per lead down
Most inflated lead costs trace back to the same few leaks:
- No negative keywords, so the budget pays for searches that will never book
- Ads landing on a slow, cluttered homepage instead of a focused landing page
- No conversion tracking, so losing keywords quietly spend for months
- Broad targeting that buys clicks outside the area you actually service
None of these are exotic. They are maintenance, done or not done. A smaller budget with these leaks fixed regularly beats a bigger budget without, which is the same conclusion as our guide to what Google Ads cost for tradies.
How Web Blend tracks it
We track every call and form back to the click that caused it, count only genuine enquiries, and report your cost per lead and your cost per booked job side by side each month. Our Google Ads management is a fixed monthly fee agreed up front, separate from your ad budget, so you always know exactly what a job cost you to win.