How much should a contractor spend on marketing?

The short answer: most home service contractors spend somewhere between 5% and 12% of their revenue on marketing. A company doing $1 million a year would land between about $4,200 and $10,000 a month, counting everything. That range is a fine gut check. Your real number should come from how many more jobs you want and what each job puts in your pocket.

A quick warning about that range. Almost everyone publishing it is a marketing company, including me, and marketing companies have a reason to like bigger budgets. So treat the percentage as a starting point, not a rule. The math further down is what you should actually trust, because it uses your numbers instead of mine.

What does 5% to 12% look like in real dollars?

Percentages are easy to nod at and hard to feel. Here is what they turn into each month, rounded.

Yearly revenue	At 5%	At 8%	At 12%
$500,000	$2,100	$3,300	$5,000
$1,000,000	$4,200	$6,700	$10,000
$3,000,000	$12,500	$20,000	$30,000
$5,000,000	$20,800	$33,300	$50,000

Those numbers include everything: what you pay Google and Facebook, what you pay an agency or freelancer, your website, your software, and any lead services. A lot of contractors only count the agency bill, then wonder why the books say something different.

Where should you be in that range?

Three things push you up or down.

• Are you trying to grow or hold steady? Holding steady with a strong book of repeat customers can sit near 5%. Adding a truck or a crew usually takes more like 10% or higher for a while.
• How crowded is your market? A roofer in a big metro is bidding against far more companies than a septic company in a rural county. More competition means every click and every lead costs more.
• How much of your work comes back on its own? Referrals and repeat customers are the cheapest jobs you will ever book. The more of those you have, the less you need to buy.

The better way: work backward from the jobs you want

A percentage tells you what other contractors spend. It does not tell you what will work for you. So start from the calendar instead. You only need four numbers, and you probably know them already. Here is an example with made-up numbers.

1. How many more jobs do you want each month? Say 10.
2. What does a job leave you after labor and materials? Say a $3,000 job leaves you $1,000.
3. How many leads does it take to book one job? Say you book 1 out of every 3 leads. That means 10 jobs takes 30 leads.
4. How much of that $1,000 are you willing to spend to win the job? Say $300.

Now do the math. Ten jobs at $300 each is a $3,000 monthly budget. Thirty leads on $3,000 means you can afford to pay about $100 per lead. And you would keep $7,000 after marketing on those 10 jobs.

That $100 is a reasonable place to be. LocaliQ's 2026 search advertising benchmarks put the average cost per lead for home and home improvement at $90.92. Your trade and town can run well above or below that, so your own numbers always win. But now you have a budget you can defend, and a target you can hold anyone to, including me.

Before you spend more, fix what is leaking

Here is the part most salespeople skip. The cheapest way to get more jobs is usually not a bigger budget. It is getting more out of the people already finding you.

One contractor I work with had a website form converting 5.7% of visitors. After fixing the site, it converted 20%. That is about three and a half times the leads from the same traffic, without spending another dollar on ads. I have also seen cost per lead drop from $42 to $10.63.

Sometimes the leak is hiding in plain sight. I looked at one roofer's site and found it was telling search engines to stay away. Every dollar spent trying to rank that site was wasted until a small file got fixed.

So before you raise your budget, check these first:

• Does someone answer the phone, or call back within minutes?
• Does every missed call and form get a quick text back?
• Can someone on a phone find your number and your services in five seconds?
• Do you know which leads actually became jobs?

If any of those are a no, more traffic just means more leaks. That is why I will not turn up the water until the bucket can hold it.

What to spend it on, and in what order

The order matters more than the amount. Each step makes the next one pay off better.

1. Your foundation. A website that turns visitors into calls, plus fast follow-up on every lead. Ads and SEO both send people here, so nothing else works until this does.
2. Getting found on Google. Your Google Business Profile, reviews, and local SEO. This is slower to start, usually a few months before you see real movement, but it keeps working when you stop paying for clicks.
3. Content. Photos, videos, and pages that show your work and answer what homeowners are asking. It builds trust before they ever call you.
4. Ads. Google and Facebook ads are the fastest way to turn up the phone once the rest is solid. Remember they are rented. Turn them off and they stop.

If you want to know what each of these usually costs, I broke down the industry ranges on my contractor marketing cost guide. For ads specifically, read what Google Ads really cost a contractor.

How much should you change it during the year?

Think of your budget in two parts. The foundation runs all year: your website, your Google profile, your follow-up. Ads are the part you can move. If you are booked out six weeks, turn them down. If the schedule has holes, turn them up. Just do not cut the foundation in a slow month to save a little. It takes months to build and it is what fills the calendar when the season turns.

How do you know if it is working?

Ignore impressions, clicks, and most of what is in a monthly report. Once a month, write down three things:

• How many leads came in
• How many of them booked
• What you spent in total

Divide what you spent by the jobs you booked. That is your cost per booked job. If it is under the number you picked earlier, you can spend more. If it is over, do not add budget until you know why. Give ads a couple of months to settle and give SEO more like three to six before you judge it.