How Much Should a Tradie Spend on Marketing?

An established Australian trade business should spend 5–10% of gross revenue on marketing — but for growth-stage businesses, working backwards from a target cost per booked job is a more reliable framework than any percentage benchmark, because the right budget depends on your conversion system, not just your revenue.

The Percentage Benchmark and Why It Has Limits

The 5–10% of gross revenue rule comes from small business benchmarking data and has been repeated so often it has become accepted wisdom. For an established trade business with stable revenue and a functioning lead system, it is a reasonable health check. If you are turning over $800,000 and spending $12,000 per year on marketing — 1.5% — you are almost certainly under-investing and constraining your growth. If you are spending $120,000 — 15% — you likely have a conversion problem that more spend is masking rather than solving.

The Australian Small Business and Family Enterprise Ombudsman publishes industry benchmarks that give trade businesses useful context for expense ratios, including marketing spend as a percentage of turnover by sector. For building and construction trades, the typical range sits between 3–8% of revenue, with higher percentages common in the growth phase and lower percentages as businesses mature and referral networks strengthen.

But here is the problem with starting from a percentage: it assumes your conversion system is working. If you are spending 7% of revenue on marketing but closing only 20% of your leads, you are spending efficiently in percentage terms but wasting significant money in absolute terms. The right framework for businesses actively trying to grow is not "what percentage should I spend?" but "what does it cost me to produce one booked job, and how many booked jobs do I need?"

The Better Framework: Work Backwards from Revenue Targets

Start with your revenue target for the next 12 months. Divide it by your average job value to get the number of jobs needed. Divide the number of jobs by your lead-to-booked-job conversion rate to get the leads required. Multiply leads by your cost per lead to get the required budget.

Example: You want to turn over $1.2 million. Your average plumbing job is $600. You need 2,000 jobs. Your conversion rate is 35% (leads to booked jobs). You need approximately 5,700 leads. At $40 CPL from Google Ads, that is a $228,000 lead generation budget — which is clearly too high, which tells you either the conversion rate needs to improve, the average job value needs to increase through upselling, or the revenue target needs adjusting. The maths reveals the problem before you waste money finding it empirically.

Most trade businesses skip this calculation entirely and set a budget based on what feels affordable. The result is marketing that can not achieve the revenue target regardless of how well the campaigns perform, or marketing that is generating leads that are lost through a broken follow-up system. The feast-and-famine cycle that most tradies experience is almost always a symptom of reactive budget decisions — spend goes up when things are slow, gets cut when things get busy, and the pipeline never stabilises.

Budget by Revenue Stage

Marketing spend requirements change significantly as a trade business grows. Here is a practical framework by stage:

Startup ($0–$300K annual revenue): At this stage, percentage benchmarks are meaningless. You need leads to build revenue, which means the marketing budget needs to be a priority spend item rather than a residual. A realistic starting minimum for Google Ads in a metro market is $1,500–$3,000 per month. Below that threshold, the data volume is insufficient to optimise campaigns. Supplement with Google Business Profile optimisation — it is free and often outperforms paid in the first 12 months for local service searches. Total monthly marketing spend at this stage: $2,000–$4,000, representing 8–16% of a $300K revenue run rate.

Growth ($300K–$1M annual revenue): This is where the percentage benchmark starts to apply. Seven to eight percent of gross revenue is a reasonable target — that is $21,000–$80,000 annually, or $1,750–$6,700 per month. At the lower end, Google Ads plus GBP maintenance plus a CRM tool is achievable. At the upper end, you can add a lead platform, run retargeting, and invest in content. The priority at this stage is building attribution — knowing which channels are producing booked jobs, not just leads.

Scale ($1M+ annual revenue): Above $1 million, marketing spend becomes a growth investment rather than a survival cost. Businesses at this stage should be spending 6–10% depending on growth ambition — $60,000–$100,000 per year for a $1M business targeting 20% growth. The channel mix expands: Google Ads, GBP, lead platforms, SEO, and paid social all become viable. The CRM infrastructure needs to be robust enough to attribute revenue to channels accurately, or the spend decisions become guesswork.

How to Allocate Budget Across Channels

Channel allocation depends on trade category and growth stage, but a practical split for a growth-phase trade business looks like this:

Google Ads: 50–60% of budget. This is the highest-intent channel — people searching "plumber near me" or "emergency electrician Sydney" are ready to book. Google Ads produces the most predictable, scalable lead volume for most trade categories. The cost is high but the intent is unmatched. Comparing Google Ads to trade platforms like hipages reveals significant differences in lead quality and exclusivity that affect the real cost per booked job.

CRM and follow-up automation: 10–15% of budget. This is consistently the most under-invested category in trade marketing. Most businesses spend nothing on follow-up infrastructure and wonder why their CPL is high. A basic CRM and automation stack — GoHighLevel, for example — costs $300–$500 per month and can improve lead conversion rates by 40–80% by ensuring no lead goes cold. That improvement has a multiplier effect on the entire ad budget.

Lead platforms (hipages, ServiceSeeking, etc.): 15–25% of budget. Shared leads from aggregator platforms have higher competition and lower close rates than Google Ads, but they provide volume and are useful for filling pipeline gaps. Shared leads typically cost $15–$60 each but have close rates of 15–25% vs 30–45% for exclusive leads, so the true cost per booked job is often higher than it appears.

GBP and reviews: 5–10% of budget. Google Business Profile management is low cost but high return. This includes the time investment in collecting reviews, responding to reviews, updating photos, and posting offers. A strong GBP in a competitive market is worth $3,000–$8,000 per month in equivalent ad spend — it generates calls that cost you nothing beyond the maintenance investment.

Cost Per Booked Job Benchmarks by Trade

These figures represent realistic ranges for Australian metro markets with a functional follow-up system in place. Businesses without CRM and automated follow-up should expect costs at the higher end or above these ranges:

Plumbing: $60–$140 per booked job. High search volume, strong emergency intent, competitive market in most cities. Emergency plumbing searches convert fast — the follow-up system matters less here than in other categories, but still adds 20–30% to conversion rates.

Electrical: $65–$150 per booked job. Similar economics to plumbing. Emergency and general electrical have different intent signals — emergency converts within the hour, general electrical requires a more sustained follow-up approach.

Solar: $180–$400 per booked job. High CPL ($80–$200+ on Google Ads), long decision cycle, strong job values ($8,000–$25,000). Conversion through the follow-up system is the dominant profit lever. Without automated follow-up, solar cost per booked job regularly exceeds $500–$800.

HVAC (heating, ventilation, air conditioning): $80–$200 per booked job. Seasonal demand creates volume spikes in summer and winter. Budget management through seasonal adjustments is important — overspending in off-peak periods drains budget needed for peak season.

Building and renovation: $100–$300 per booked job. Longer sales cycles than service trades. High job values — $20,000 to $200,000+ — make even expensive lead generation viable if conversion is managed. The CRM follow-up system is critical for building trades because the decision cycle can run three to twelve months.

The ROI Health Check: Every Dollar Should Return Four to Six

The minimum acceptable return on marketing spend for a trade business is $4 in gross revenue for every $1 spent — a 4:1 return. That is the floor, not the target. Well-run trade businesses with good attribution data and solid conversion systems typically see $5–$8 return per dollar spent. If you are below $4, the problem is usually one of: wrong channel mix, poor lead quality, or broken conversion (slow follow-up, no CRM, inconsistent quoting).

To calculate your actual ROI, you need revenue attribution — the ability to trace a booked and completed job back to its original lead source. Without call tracking and CRM pipeline data, this is impossible. You will be calculating total revenue divided by total marketing spend and calling it ROI, which tells you nothing useful about which channels to increase and which to cut. The system that converts leads to booked jobs is the same system that produces the attribution data you need to make smart budget decisions.

What Wasted Marketing Budget Looks Like

Wasted budget is identifiable if you know what to look for:

Set-and-forget Google Ads. Campaigns that were set up by an agency 18 months ago and have not been reviewed since. Ad copy that does not match current pricing or services. Broad match keywords driving irrelevant traffic. Landing pages that have not been updated. This category of waste is common and expensive — easily 30–50% of the Google Ads budget producing nothing.

Leads without follow-up. Spending $3,000 per month on Google Ads, getting 60 leads, and personally calling back 30 of them two days later. The other 30 go cold. The 30 you did call had half their decision made for a competitor by the time you got to them. This is probably the most common form of waste in trade marketing — not a channel problem but a process problem that burns the channel's potential.

Paying for leads without tracking outcomes. Buying leads from a platform for $40 each, spending $1,200 on 30 leads, and having no record of which ones converted to booked jobs or why the others did not. Without this data, you cannot improve. You are just repeating the same results month after month.

When to Increase Budget vs When to Fix Conversion First

The rule is simple: if your cost per booked job is above your trade's benchmark range, fix the conversion system before increasing budget. More leads into a broken follow-up process does not fix the problem — it scales it.

If your cost per booked job is within or below benchmark, you can scale budget with confidence that the additional spend will produce proportional results. This is when increasing Google Ads spend from $3,000 to $5,000 per month genuinely moves the revenue needle rather than just increasing cost per lead.

The false economy of cutting marketing during slow periods deserves direct attention: cutting spend when the pipeline is thin guarantees the pipeline stays thin. Maintaining consistent marketing spend through slow periods — and ensuring your GBP is generating free leads in parallel — is what separates businesses that grow predictably from those that ride the revenue rollercoaster.

Simple Call Tracking and Job Attribution

You do not need an enterprise analytics stack to track what is working. A basic setup for trade businesses:

Call tracking number per channel. One number for Google Ads, one for your GBP listing, one for your website direct traffic. When a lead calls, you know immediately which channel generated it. Call tracking services in Australia run $30–$80 per month for basic setups.

CRM pipeline stage tracking. Every lead goes into the CRM with its source tagged. When it converts to a booked job, the revenue is attributed to the source. After 90 days, you have real cost-per-booked-job data by channel — not estimated, not assumed, actual.

Monthly review of channel performance. One hour per month looking at cost per booked job by channel, adjusting budget allocation accordingly. The highest-performing channels get more. The underperformers get investigated — is it the channel, the lead quality, or the follow-up process failing at that entry point?

This is not complex. It requires commitment to using the system consistently, not technical sophistication. The trade businesses that get the best return on their marketing budget are almost never the ones spending the most — they are the ones who know exactly what each dollar is producing.