"How much should we spend on Google Ads?" is usually the first question in an audit, and the honest answer is that a fixed number on its own means very little. What matters is whether your budget can buy enough of the right clicks to produce enquiries you can measure, often enough to learn from. This guide walks through how to work that out for your own market, rather than borrowing a figure that was set for someone else's.
Start from the outcome, not the budget
Work backwards from what a new customer is worth to you. If an average job is worth a few thousand dollars in margin and one in four qualified enquiries becomes a job, you can afford to pay a meaningful amount for each qualified enquiry and still come out ahead. If an average sale is small and one-off, the maths is much tighter. Write these three numbers down before you set any budget:
- the gross margin from an average new customer (and their likely repeat work);
- how many enquiries it typically takes to win one customer;
- the most you could pay for an enquiry and still be happy with the result.
That last number is your target cost per enquiry. Everything else in the budget follows from it.
Estimate what clicks cost in your market
Click prices in Australia vary enormously by service and location. A commercial service in a competitive city can cost many times more per click than a niche trade in a regional area. Don't guess: use Google's Keyword Planner inside a Google Ads account to see the estimated top-of-page bid ranges for the searches your buyers actually make, filtered to the areas you serve. Take the upper end of the range as your planning figure, because the searches with the clearest buying intent are usually the most contested.
Do the simple maths
Once you have a planning cost per click, the monthly budget is roughly:
enquiries you want per month ÷ conversion rate of your landing page × cost per click
If your landing page turns a modest share of clicks into enquiries, you need far more clicks per enquiry than if it is focused and fast. This is why the website matters as much as the ads: improving the page often does more for your cost per enquiry than raising bids. If the number that comes out is uncomfortable, it's better to know that now than three months in.
The budget below which you shouldn't bother
A campaign needs enough data to make decisions. If your budget only buys a handful of clicks a week, it can take months to learn which searches, ads and pages work, and you will be making changes on noise. Most accounts start from A$1,000 a month in ad spend, paid directly to Google. Below that it is still possible to run a tightly focused campaign on your most valuable searches, but you should expect slower learning and be ready to cut anything that isn't producing enquiries.
If your numbers say you can't afford enough clicks to learn, it may be better to fix the website and build organic visibility first, then add paid search once each click is more likely to convert.
Where most budgets leak
The money that disappears without producing work usually goes to the same few places:
- Broad matching without negatives. Ads showing for loosely related searches (job seekers, DIY questions, competitors' brand names) that will never become customers.
- Wrong locations. Location settings that include people "interested in" your area rather than people in it.
- Display and partner networks switched on by default. Fine in some cases, but often a quiet drain for service businesses that only need search.
- No conversion tracking, or the wrong one. If Google is optimising towards page views or button clicks instead of real enquiries, it will find you more of the wrong thing.
- Sending paid clicks to the home page. A general page makes the visitor do the work of finding what they searched for.
Management fees are a separate line
Keep the ad budget and the management fee apart in your planning. The ad spend should be paid directly to Google from your own account, so you can always see what was spent and on what. The management fee pays for the strategy, setup, optimisation and reporting. Be cautious of any arrangement where you can't see the account, or where the fee is a percentage of spend that rewards spending more rather than spending well.
Review it monthly, scale it carefully
Set the budget for the first one to two months as a learning budget, not a forever number. Wasted spend usually shows up in the first week or two; lead volume and quality take longer, often four to eight weeks of data before scaling decisions are reliable. Once you can see which searches produce enquiries that turn into work, move budget towards them and away from the rest. Increase spend in steps and watch whether the cost per qualified enquiry holds.
A quick checklist before you spend a dollar
- You know your target cost per enquiry.
- Conversion tracking records real enquiries (form submissions and calls), not page views.
- Each campaign sends people to a page that matches what they searched for.
- Locations, networks and match types are set deliberately, not left on the defaults.
- You have a list of negative keywords for searches you never want to pay for.
- The ad account is in your name and the spend is billed to you.
If you'd like a second opinion on your numbers, our Google Ads management service starts with a free 30 minute account audit: we'll show you where spend is leaking and what we'd change first, whether or not you work with us.