How Much Should I Spend on Google Ads?

A straight-up guide for tradespeople and small business owners

If you’re a tradie or small business owner looking to get more leads, you’ve probably heard that Google Ads can help get the phone ringing. But then comes the big question:

How much should I spend on Google Ads to make it work?

Too little, and you risk wasting money without results. Too much, and you might blow your budget without knowing if it’s paying off. This article breaks it all down in plain English, no marketing jargon, no hype.

Why Google Ads Works for Tradies and Local Businesses

Unlike social media ads that rely on people scrolling by, Google Ads targets people who are actively searching for what you do.

• “Blocked drain Christchurch”
• “Emergency electrician near me”
• “Small bathroom renovation quote”

These are the kind of searches Google Ads shows your business for and that’s where the real value is. You’re not interrupting people, you’re showing up right when they need you.

But of course, there’s a catch: you have to pay per click. And that’s where things get tricky if you’re not sure what to expect.

What Impacts How Much You’ll Need to Spend?

Your Industry

Some trades are more competitive than others. For example:

• Plumbing and electrical services are highly searched and highly competitive
• Drainlayers, gasfitters, and landscapers are a bit more niche, usually cheaper to advertise

The more businesses bidding on the same keywords, the more it costs to get clicks.

Your Location

If you’re in a smaller town or regional area, your ad spend will usually go further. In bigger cities like Auckland, Wellington, or Christchurch, there’s more competition and higher click costs.

That said, Google lets you target specific areas or a radius around a location, so you can choose how wide or narrow you go.

Your Services

High-urgency services like “emergency plumbing” or “24/7 electrician” tend to cost more per click, but they also bring in leads that are ready to book now. General or research-based searches like “bathroom ideas” will cost less but are less likely to convert.

Realistic Click Costs in NZ

Here’s what to expect for most trades and local businesses in New Zealand:

These numbers can go up or down depending on your area, how specific your keywords are, and how well your ads are set up.

Don’t Just “Test It with $100”, Here’s Why

A common mistake is saying:

“I’ll try $100 and see what happens.”

Sounds sensible, but here’s the problem:

If your average click costs $8, that $100 only gets you 12 clicks. And not every click turns into a lead.

Let’s say your website converts 1 in 20 visitors (which is average for most trades websites). That means you might not even get one lead from $100. Not because Google Ads doesn’t work, but because the budget wasn’t enough to give it a fair test.

How to Work Out a Budget That Makes Sense

Here’s a practical way to figure out what you should spend, using some basic maths.

Step 1: What’s Your Average CPC?

Let’s assume:

• You’re a plumber in Christchurch
• Average cost per click = $8

Step 2: How Many Clicks to Get a Lead?

Most trades websites convert at around 5%, so you need 20 clicks to get 1 lead.

20 clicks × $8 = $160 per lead

Step 3: How Many Leads to Get a Customer?

Let’s say you close 1 in 3 leads → that’s $480 per paying customer

Step 4: Is That Worth It?

If the average job you land brings in $800, $2,000+, then spending $480 to win a customer is worth it, especially if you do more work for them in future.

What Should Your Daily Budget Be?

As a rule of thumb, you want enough daily budget to get at least 2, 4 clicks per day.

If your CPC is $8:

• Minimum daily budget = $16, $32
• Monthly = $480, $960

That gives you 60, 120 clicks per month, which might generate 3, 6 leads, and hopefully 1, 2 customers

If You’re On a Tighter Budget

You can still make Google Ads work on $15, $20/day (about $450, $600/month), but you need to:

• Focus on specific services (e.g. “blocked drain repair”)
• Use exact match or phrase match keywords
• Target a small service area
• Set ads to run only during business hours
• Send traffic to a page that’s designed to convert, not just your homepage

What Bigger Businesses Spend (Just for Comparison)

Larger trades businesses or franchises might spend:

• $2,000, $5,000+/month
• Run multiple campaigns (for different services or regions)
• Use remarketing, display ads, and branded search

But that doesn’t mean you need to match them dollar-for-dollar, just that you need to be smarter with how you use your budget.

What If You Don’t Know Your Numbers Yet?

Here’s a basic budget guide to help you plan:

You can adjust the numbers up or down based on your conversion rate and close rate, but this gives you a solid baseline.

Watch Out for Wasted Ad Spend on Timewasters & Competitors

One of the biggest frustrations for trades and small business owners running Google Ads is paying for clicks that never turn into customers. It’s real and if you don’t manage your campaign carefully, you can burn through hundreds of dollars before getting a single decent enquiry.

Who are these timewasters?

• Price shoppers who click your ad, ask for a quote, and disappear
• DIYers looking for free advice or just browsing
• People outside your service area
• Worst of all, competitors clicking your ads to burn your budget (yes, it happens)

At $5, $10 per click, even 10 wasted clicks = $50, $100 gone with no chance of a return.

How to reduce waste:

• Use negative keywords like “free”, “course”, “DIY”, “job”, “how to”
• Mention price or service type in your ad copy (e.g. “From $500”, “Residential only”, “Trades only”)
• Tightly geo-target your area, don’t run ads across the whole country if you only work in one city
• Set up an ad schedule to only run during the day (unless you want to target emergencies at night).

With the right setup, you can filter out tyre-kickers and focus your spend on people who actually want to hire you.

How to Keep Costs Down While Still Getting Results

Here are some smart ways to make your ad spend go further:

Use Long-Tail Keywords

Instead of bidding on “plumber”, target:

• “fix leaking tap Christchurch”
• “drain unblocking near me”
• “electrician for rental property dunedin”

These cost less and show more intent, however you’ll have less volume as “most” people will simply search for ‘plumber’ if they have a leaking tap. So long-tail keywords will only target those who search for that query specifically.

Exclude Irrelevant Clicks

Add negative keywords like:

• free
• diy
• job
• course
• training

This helps avoid wasting money on people who aren’t your customers.

Set Up a Landing Page That Converts

Don’t just send people to your homepage. A good landing page:

• Matches the service you’re advertising
• Shows your phone number and a quick contact form
• Lists your locations and services clearly
• Has trust elements, reviews, photos, qualifications

Track Conversions

Use call tracking or conversion goals in Google Ads so you know what’s working and what’s not.

Know Your Customer Lifetime Value (LTV)

Before deciding how much to spend on ads, you need to understand how much a customer is really worth to your business, not just for one job, but over time.

This is called your Customer Lifetime Value (LTV) and it’s the key to knowing whether your Google Ads are truly profitable.

How to calculate it:

1. Average profit per job
   Let’s say your average plumbing job brings in $300 profit.
2. Repeat work or referrals
   If 1 in 3 customers comes back once a year, or refers a mate who books too, you might actually be making $600+ off that one original customer.
3. Lifetime Value (LTV)
   So even if you spend $400 to win a job, that customer could be worth $600, $1,000+ over time.

Why this matters:

If you’re only looking at the cost of the first job, you might think you’re breaking even, or even losing money. But if you factor in repeat work, referrals, and upsells, you’ll see that a $300, $500 ad spend per customer can still be very profitable.
In fact if you factor in the positive effects a good review has on your business, which could generate even more enquiries due to the improved rankings and trust score of your business., this lifetime value could be worth much more.

Example: Customer Lifetime Value for a Plumbing Business

What This Means:

Even if you spend $300, $500 to get one paying customer through Google Ads, it’s still profitable, as long as you deliver great service and follow up for repeat work or referrals and get that sweet, sweet Google review.

This is why Google Ads should be seen as an investment, not just a cost. You’re not buying one job, you’re buying a long-term customer relationship that you can possibly turn into a trusted sales team.

How Much Should a Small Business or Tradie Spend on Google Ads?

If you want real leads from Google Ads, you need to give it a fair chance.

Here’s the wrap-up:

• CPCs in NZ trades industries average $5, $10
• To get 1 lead, you’ll likely need $150, $200
• To get 1 customer, plan on $400, $500 spend
• A $500, $1,000/month budget is realistic for most local businesses
• Focus on high-intent keywords, tight targeting, and conversion tracking

Final Thought

Google Ads can absolutely work for small businesses, even on a modest budget, but only if you:

• Know what your ideal customer is searching for
• Focus on what brings in real leads
• Set realistic expectations based on the numbers

If you want help setting up a campaign, reviewing your current setup, or just figuring out where to start, I’m here to help.