How much should you spend on marketing? It's one of the most common questions home service business owners ask, and one of the hardest to get a straight answer on.
Ask a marketing agency and they'll say "more." Ask a frugal business owner and they'll say "as little as possible." Neither answer is particularly helpful.
The real answer depends on where your business is, where you want it to go, and — most importantly — whether you can actually track what your marketing dollars are producing.
Let's break it down with real numbers.
The General Rule of Thumb
For home service businesses, the general guideline looks like this:
- Maintenance mode (keeping current revenue steady): 5-8% of gross revenue
- Growth mode (actively trying to grow): 8-12% of gross revenue
- Aggressive growth (new market, new service line, big expansion): 12-15% of gross revenue
So if your business is doing $30,000 per month in revenue and you want to grow, you should be spending roughly $2,400-$3,600 per month on marketing.
That might sound like a lot. But here's the thing: marketing isn't an expense. It's an investment. A dollar spent on marketing should come back as $3-$5 in revenue. If it's not doing that, the problem isn't your budget — it's your strategy.
Where to Put Your Money: The Channel Breakdown
Not all marketing channels are created equal. Here's where home service businesses typically get the best return on investment, ranked roughly by effectiveness:
1. Google Business Profile (Free to Low Cost)
Your Google Business Profile (formerly Google My Business) is the single most important marketing asset you have. When someone searches "plumber near me" or "HVAC repair [your city]," your GBP listing is what shows up in the map results.
What it costs: Free to set up and maintain. Optional: $100-300/month for a service that helps optimize it.
What to do: Make sure your profile is complete (hours, services, photos, service area), respond to every review, post updates regularly, and actively work on getting more reviews.
ROI: Extremely high. For many home service businesses, GBP generates more leads than any paid channel — for free.
2. Google Ads ($1,000-$3,000/month for most markets)
Google Ads (pay-per-click) puts you at the top of search results when people are actively looking for your services. This is "intent-based" marketing — you're reaching people in the moment they need you.
What it costs: Varies wildly by market. In a small town, you might spend $1,000/month. In a competitive metro area, $3,000-$5,000/month is common. Cost per click for home service keywords typically runs $15-$50.
What to watch out for: Google Ads can eat your budget fast if not managed properly. Make sure you're tracking which clicks turn into actual booked jobs, not just calls. A lot of clicks are price shoppers who never convert.
ROI: Good if managed well. Target 4-5x return on ad spend. If you're spending $2,000/month and not generating at least $8,000-$10,000 in booked revenue, something needs to change.
3. Review Generation ($0-$100/month)
As covered in our article on review strategy, actively generating Google reviews improves your ranking, builds trust, and directly drives more calls. This is one of the highest-ROI activities you can do.
What it costs: An automated review request system typically costs $50-$100/month. Or you can do it manually for free (but you won't be consistent).
ROI: Exceptionally high. More reviews lead to higher rankings, which lead to more free organic calls.
4. SEO / Content Marketing ($500-$2,000/month)
Search engine optimization helps your website rank higher in organic (non-paid) search results. Content marketing — like blog posts about common homeowner questions — attracts visitors to your site and establishes you as an authority.
What it costs: A decent local SEO provider charges $500-$2,000/month. You can do some of it yourself (writing blog posts, optimizing your website) for free.
What to know: SEO is a long game. You won't see results for 3-6 months. But once your site ranks well, it generates free traffic indefinitely.
ROI: High in the long run, slow to start. Best combined with GBP optimization and review generation.
5. Yelp ($0-$500/month)
Yelp still matters for home services, especially in certain markets. Having a claimed and optimized profile is free. Yelp's paid advertising is optional and results vary widely.
What it costs: Free for a basic listing. $200-$500/month for Yelp Ads.
What to know: Some businesses get tremendous results from Yelp. Others get nothing. Track your leads from Yelp carefully before committing to paid ads.
6. Social Media ($0-$500/month)
Facebook and Instagram can work for home services, but they're generally lower priority than search-based channels. Social media is best for staying top-of-mind with past customers and generating referrals, not for immediate lead generation.
What it costs: Free to post organically. $300-$500/month for paid Facebook/Instagram ads.
What to know: Don't put money into social media ads until your Google presence is dialed in. People looking for a plumber right now are searching Google, not scrolling Facebook.
Budget Breakdown by Business Size
Here's what realistic marketing budgets look like at different revenue levels:
Small Business: $5,000-$10,000/month in revenue
Marketing budget: $500-$1,000/month| Channel | Monthly Spend |
|---------|:---:|
| Google Business Profile | $0 (DIY) |
| Google Ads | $300-$600 |
| Review automation | $50-$100 |
| Yelp (free listing) | $0 |
| Total | $350-$700 |
At this stage, every dollar counts. Focus on Google Business Profile (free), getting reviews consistently, and a small Google Ads budget targeting your most profitable services. Don't spread thin across too many channels.
Medium Business: $15,000-$30,000/month in revenue
Marketing budget: $1,500-$3,000/month| Channel | Monthly Spend |
|---------|:---:|
| Google Business Profile | $0-$200 |
| Google Ads | $800-$1,500 |
| SEO / Content | $500-$800 |
| Review automation | $50-$100 |
| Yelp Ads | $200-$400 |
| Total | $1,550-$3,000 |
Now you can afford to diversify. Keep Google as your core, add SEO for long-term organic growth, and test Yelp Ads to see if they convert in your market.
Large Business: $50,000+/month in revenue
Marketing budget: $4,000-$7,000/month| Channel | Monthly Spend |
|---------|:---:|
| Google Business Profile optimization | $200-$300 |
| Google Ads | $2,000-$3,500 |
| SEO / Content | $1,000-$2,000 |
| Review automation | $100 |
| Yelp Ads | $300-$500 |
| Social Media / Brand | $300-$500 |
| Total | $3,900-$6,900 |
At this level, you should be tracking ROI per channel religiously and reallocating budget quarterly based on actual performance data.
The Biggest Waste of Marketing Money
Want to know the single biggest waste of marketing dollars in home services? It's not spending on the wrong channel. It's not even overpaying your marketing agency.
It's paying for leads you never follow up on.
Think about it. You spend $2,000 on Google Ads. The ads work — they generate 25 phone calls. But you miss 8 of those calls and never call them back. The customers who did leave a voicemail? You called them back 4 hours later and they'd already booked with someone else.
You effectively lit $640 of your ad budget on fire. Not because the ads didn't work, but because you didn't have a system to handle the leads they produced.
This is the hidden marketing expense that nobody talks about. Your lead follow-up system is part of your marketing. If leads come in and don't get responded to within minutes, your marketing ROI will always look bad — no matter how much you spend.
How to Know if Your Marketing Is Actually Working
The answer is deceptively simple: track revenue per channel, not just leads per channel.
Here's the difference:
What most businesses track: "Google Ads generated 20 calls this month."
What you should track: "Google Ads generated 20 calls, 7 booked jobs, and $5,600 in revenue this month. Cost per acquisition: $286. ROI: 2.8x."
When you track revenue per channel, your marketing decisions become obvious. Double down on channels with high ROI. Fix or cut channels with low ROI. Stop guessing.
This requires two things: lead source tracking (knowing where each call came from) and pipeline tracking (knowing which leads turned into paying jobs and for how much). Tools like FlowLine give you both — each tracking number is tagged to a source, and your dashboard shows revenue by source automatically.
The Bottom Line on Marketing Budgets
Here's what matters more than your total budget:
1. Know where your money is going. Track every marketing expense by channel.
2. Know what each channel produces. Track leads AND revenue per channel.
3. Respond to every lead fast. The best marketing in the world can't help you if you're not answering the phone.
4. Review and adjust quarterly. What worked last quarter might not work this quarter. Stay flexible.
5. Start with the free stuff. Google Business Profile and reviews cost nothing and often outperform paid channels.
The right marketing budget isn't about spending a magic number. It's about spending intelligently, tracking results, and putting more money behind what works.
Stop throwing money into the dark. Turn the lights on, see what's working, and grow with confidence.