Brandie Neagles
Search this question and you’ll find a different answer everywhere you look: $500 a month, $2,500 a month, 7-10% of revenue, $10,000 for “serious” results. Here’s the honest truth: none of those numbers know anything about your business. They’re all somebody else’s rough guess, presented with more confidence than it deserves.
Here’s how to calculate your own number instead.
Why the generic ranges don’t actually help you
A $500/month budget might be plenty for a locksmith in a small town with low competition and cheap clicks. That same $500 wouldn’t buy a personal injury attorney in a major city more than a handful of clicks before running out. Cost per click varies enormously by industry and location, sometimes by a factor of ten or more between two businesses that both call themselves “local services.” A single recommended dollar figure can’t account for that, no matter how confidently it’s stated.
The formula that actually works
Instead of starting with a dollar amount, start with your own numbers and work backward:
How many new customers do you actually want this campaign to bring in per month? Be specific. “Some” isn’t a number you can budget against.
What’s a customer actually worth to you? Look past the first job and factor in repeat business if that’s typical for your business. A plumbing customer who calls back for future work and refers a neighbor is worth considerably more than the value of that first service call alone.
What can you afford to pay to acquire one customer, and stay profitable? This is your target cost-per-acquisition. If a customer is worth $2,000 over time and you’re comfortable spending 15% of that to acquire them, your target cost-per-acquisition is around $300.
Multiply your target customer count by your target cost-per-acquisition. Want 10 new customers a month at a $300 target CPA? That’s roughly $3,000 a month. That’s a real number, built from your actual business math instead of a generic range.
This won’t be exact on day one. You don’t yet know your actual conversion rates or cost-per-click, so treat it as an informed starting point, not a fixed number.
A practical floor worth knowing
There’s one piece of genuinely useful general advice buried in all those competing numbers: a budget too small to generate a meaningful volume of clicks won’t give you (or Google’s own optimization systems) enough data to tell what’s working. That doesn’t mean you need a huge budget to start. It means an extremely small test budget in a competitive, high-cost category may not tell you much of anything, and it’s worth knowing that going in rather than concluding “Google Ads doesn’t work” after a token spend.
Every ‘here’s what to spend’ article you’ll find is a guess dressed up as a rule. The only number that actually means anything is the one built from your own costs, your own margins, and what a customer is genuinely worth to you.
Brandie Neagles, Coyote Creative
What else determines your real number
As we covered in Google Ads for Service Businesses: A No-Nonsense Guide, the channel you choose changes this math too. Local Services Ads run on a pay-per-lead model rather than pay-per-click, which changes how you think about budget entirely. You’re not estimating clicks and conversion rates, you’re paying directly for contacts. If your category is LSA-eligible, it’s worth reading that comparison before finalizing a budget built entirely around standard Search Ads assumptions.
Start with a number you can actually defend
The right Google Ads budget isn’t the one that sounds impressive or the one that matches what a blog post told you to spend. It’s the number that comes out the other end of your own math: how many customers you want, what they’re worth, and what you can afford to pay to get them. Everything else is a starting point for a conversation, not a rule.
Want an actual number instead of a guess? Book a free strategy session and we’ll work out a real budget based on your numbers.
