Is Google Ads worth it for a local business? It depends. It works for high intent searches: when people search for what you sell and you can turn the click into a phone call. If you can’t do both then it’s not a great fit.
Google Ads for local businesses: how it works
You pay Google each time someone clicks your ad. This is called “Cost per Click” or CPC. You choose the searches, the suburbs and a daily budget. Your ad can show when someone types something like “blocked drain Camden”, and you only get charged by Google when they click it.
When it’s worth it
- People search with high intent. A plumber or an electrician gets searches from people who need someone to fix something today.
- It’s all Customer Acquisition Cost to customer Lifetime Total Value. Unless you’re operating completely organically on word of mouth alone, it’s going to cost you money (in the form of your time or advertising cost) to buy the attention of your customers. The $ spent acquiring customers must be less than the total amount that each customer ends up giving you. Here’s the maths with made-up numbers. If a click costs $5 and 1 in 10 clicks turns into an enquiry, each enquiry costs $50 in clicks. If 1 in 2 enquiries becomes a job worth $400, that job cost $100 to win. That’s a 1:4 ratio where each dollar you put in returned as 4 dollars of revenue.
- Your website or profile can turn the click into a call. That means a phone number people can tap and a form that works. If a person sees your ad, clicks on it, reads your advertising copy, calls through to you and ends up buying, then what you’ve just created is an effective and basic sales funnel. It’s that simple.
When to wait
- Your profile is half filled in and your site is slow. Ads would send people to a weak page, and you’d pay for the click anyway. Worse still, a bad website or a half filled in profile can hurt your credibility and damage trust in your brand.
- Nobody searches for what you sell yet. Ads answer a search. They don’t create one. This is usually pretty rare, and typically we can reposition your product or service so that it will pop up in a customer search. If what you sell is truly unheard of, we will discuss what options are available to get you leads.
- You can’t answer the phone or reply quickly. An enquiry goes cold fast. About 78% of people buy from the first business that gets back to them, and you are 80% less likely to convert a lead if you wait more than 5 minutes to respond to them.
In those cases, fix the profile and the website first. They cost less, and they make the ads work harder later.
What it costs
There are two costs. The first is what you pay Google for clicks, which comes out of your ad account. The second is what you pay whoever manages the campaign. Our management starts from $600 per month, with no lock-in.
For the clicks, which are most of your Google Ads budget, we believe Google needs about 10 to 15 clicks a day to learn what works and send you good leads. Often that means at least $1,000 a month in ad spend, but we find around $2,250 a month will get you the clearest results. Here’s the maths with a made-up $5 click: 15 clicks a day over 30 days is 450 clicks, which comes to $2,250.
Your cost per click decides the real number, and it depends on your industry and where you work. A personal injury lawyer in a big city can pay far more per click than a country lawyer who handles a bit of everything. An emergency plumber in Broken Hill will probably pay less per click than one in Melbourne. We do our best to bring your cost per click down, and before you start we’ll tell you what your budget can realistically do.
How to know it’s working
Count calls and form enquiries from your ads, not just clicks. Ask whoever runs your ads for a monthly report in plain English that shows what each enquiry cost. Our guide to tracking enquiries from Google shows how, and Google’s own Google Ads help explains the conversion settings.
If you’re not sure which side of the line you’re on, ask for the free audit. We’ll look at your profile and website first and tell you honestly whether ads should wait.