What is a good cost per lead for a home-service company?
Short answer
There's no single good number. A cost per lead is good when it leaves a profit after two facts about your own business are applied: what a booked job is worth to you, and what share of your leads turn into booked jobs. Anyone who quotes a figure without knowing those two facts is guessing.
For a home-service company, a good cost per lead is any figure that still leaves a profit once you know what a booked job is worth to your business and what share of your leads book. Without those two facts, nobody can quote a good number, and I won’t quote one here. The same cost can be a bargain for one company and a slow loss for another in the same city.
The two facts that set your number
Start with what a booked job is worth. That means what the job leaves after labor, parts and the truck, and not the invoice total. If a first visit often leads to a maintenance agreement or a later replacement, that belongs in the figure too.
Then comes your booking rate: of the leads that reach you, how many end up on the schedule. It turns a cost per lead into a cost per booked job. If one lead in four books, a booked job costs you four leads. If one in two books, it costs two. So a company that answers every call and books half of them can afford to pay far more for a lead than a company that lets calls go to voicemail.
Put together: the most you can pay for a lead is the amount you’re willing to spend to win a job, multiplied by your booking rate. Everything below that line is a good cost per lead for you.
Why the answer differs between companies
The acceptable cost moves with the kind of work being sold. A hypothetical company in El Cajon that sells full air conditioning replacements can pay much more for a lead than one that mostly clears drains, because each booked job carries more.
| Factor | Raises what you can pay | Lowers what you can pay |
|---|---|---|
| Job type | Replacements and installations | Small repairs and tune-ups |
| Repeat work | Customers who sign up for maintenance | One-time jobs |
| Phone handling | Calls answered live and booked on the spot | Missed calls and slow callbacks |
| Lead type | A lead sent to you alone | A lead sold to several companies at once |
| Capacity | Open slots on the schedule | Crews already booked out |
Why published benchmarks mislead
Averages across an industry tell you very little about your own account. They blend one trade with another across cities and seasons, and they are often published by companies that sell leads or advertising. They also rarely say what was counted as a lead.
The definition of a lead is the bigger problem. A form fill, a phone call of any length, a call from a real homeowner and a booked appointment are four different things, and each has been called a lead. A report can show a low cost per lead by counting every ring, including the job seekers and sales calls that make up junk leads from Google Ads. Before comparing two figures, check that they count the same thing.
The number worth watching instead
Cost per booked job is the better figure, because it already contains the booking rate. To get it, each call has to be traced to its source and marked as booked or not, which is what call tracking is for. With that in place, you can compare campaigns fairly. One with expensive leads that book often can beat one with cheap leads that rarely do.
How I’d work it out with you
I’d start with your own records and not with anyone’s average: which services you most want to sell and what each leaves you. Then how many calls your office books. From that comes a ceiling for each service. I measure the account against it every month as part of Google Ads management. Where a service runs over its ceiling, I change one thing and measure again. Where a service can’t be brought under it, the honest answer is to stop advertising that service.