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Online advertising has emerged as a powerful tool for home service businesses to expand their reach and attract new customers. We will explore the vast possibilities of online advertising, the impact on net-new client acquisition costs, the significance of lifetime customer value, the concept of return on ad spend (ROAS), and the importance of conversion rates. By understanding these key factors, you can unlock the true potential of online advertising to fuel your business growth.

The Power of Online Advertising

Online advertising offers home service businesses the opportunity to connect with a broader audience in a cost-effective manner. Let’s delve into the various aspects that make online advertising a game-changer for your business.

Cost-Per-Lead and Return on Ad Spend (ROAS)

To understand the potential impact of online advertising, it’s essential to consider the cost-per-lead figures associated with different home service categories. These figures represent the average amount spent to acquire a single lead in a specific category. Here are a few examples of median cost-per-lead figures:


Lead Amount
Air Conditioning $109
Appliance Repair $52
Architects $128
Asbestos $93
Asphalt $77
Basement Remodeling $153
Basement Remodeling $153
Bath Remodeling $395
Bed Bug Removal $41
Building Demolition $143
Cabinets $77
Carpentry $49
Carpet & Rug Dealers $32
Carpet Cleaning $52
Chimney Cleaning $41
Concrete Paving $77
Countertops $77
Custom Homes $765
Decks $104
Decorators & Designers $59
Door Installation $44
Drywall $56
Electrician $88
Fencing $58
Fire Damage Restoration $330
Flooring $62
Foundation Repair $104
Furniture $31
Garage Doors $67
Gutters $52
Handyman $55
Heating $109
Home Additions $620
Home Appraisals $41
Home Inspections $52
Home Security $109
Lead Amount
Home Warranty $64
Insulation $88
Junk Removal $77
Kitchen Remodeling $634
Landscaping $88
Lawn Care $52
Locksmiths $52
Maid Service $77
Masonry $104
Mold Removal $64
Painting $52
Paving $67
Pest Control $59
Plumbing $77
Portable Toilets $32
Pressure Washing $59
Property Management $128
Remodeling $459
Roofing $221
Satellite TV Service $77
Self Storage $52
Siding $208
Solar $261
Stair Lifts $109
Structural Engineer $357
Sunroom $261
Swimming Pools $174
Tile Installer $52
Tree Service $64
TV Repair $44
Water Damage Restoration $541
Waterproofing $109
Welders $44
Wildlife Removal $77
Window Replacement $249


It’s important to note that these figures are based on industry data and may vary depending on factors such as location and targeting strategies. Now, let’s consider the conversion rate and explore the impact of a $5,000 ad budget on a specific service category: Fencing.

Enhanced Conversion Rates and Net-New Client Acquisition Costs

While the industry average conversion rate is approximately 10%, it’s essential to note that conversion rates can vary based on factors such as the quality of your landing page, the effectiveness of your ad copy, and the relevance of your targeting. By constantly optimizing your campaigns, you can strive for higher conversion rates and maximize your return on investment.

Now, let’s dive into the example of fencing to understand the potential impact of online advertising on net-new client acquisition costs. Assuming a conversion rate of 10% and a $5,000 ad budget, we can calculate the number of leads generated and the subsequent conversion to sales.

With a $5,000 ad budget, you can divide the budget by the cost-per-lead for fencing, which is approximately $58. This yields an estimated number of leads generated, which in this case would be approximately 86 leads (rounded up from 86.21).

Considering the 10% conversion rate, 8.6 leads (rounded up from 8.621) are expected to convert to sales.

It’s important to remember that these numbers are based on general benchmarks and may vary for each business. However, they provide a valuable starting point for understanding the potential outcomes of your online advertising efforts.

The Significance of Lifetime Customer Value

While focusing on the initial sale is crucial, it’s equally important to consider the lifetime value of a customer. Home service businesses can often generate additional revenue through repeat business, upselling or cross-selling opportunities, and referrals from satisfied customers. By delivering exceptional service and nurturing customer relationships, you can maximize the lifetime value of each customer and significantly impact your bottom line.

Return on Ad Spend (ROAS) and Beyond

Return on ad spend (ROAS) is a vital metric for assessing the effectiveness of your advertising campaigns. It measures the revenue generated for every dollar invested in advertising. By analyzing ROAS, you can identify the most successful advertising channels, optimize your budget allocation, and refine your strategies to maximize returns.

It’s important to recognize that the true value of online advertising extends beyond the initial sale. When considering the impact of online advertising on your business, take into account the potential for repeat business, upselling or cross-selling opportunities, and referrals. These additional revenue streams can significantly enhance your return on investment and justify the costs associated with acquiring net-new clients.

Final Remark

Online advertising presents an unparalleled opportunity for home service businesses to expand their customer base, increase revenue, and establish a strong foothold in a competitive market. By leveraging the power of online advertising, you can effectively reach your target audience, optimize your marketing budget, and drive substantial growth.

While the cost-per-lead figures shared in this article provide general benchmarks based on industry data, it’s crucial to adapt them to your specific business and market conditions. Remember that net-new client acquisition costs are often higher, but the lifetime customer value and the potential for repeat business and referrals can outweigh the initial investment.

To maximize your success, focus on optimizing your online advertising campaigns, crafting persuasive messaging, delivering exceptional customer experiences, and tracking key metrics such as conversion rates and return on ad spend. By continually refining your strategies based on data-driven insights, you can position your home service business for long-term success in the digital age.

Published On: July 5th, 2023 /