How Much Should a Service Business Spend on Ads?
How Much Should a Service Business Spend on Ads?
One of the most common questions service business owners ask is simple, but loaded:
How much should I spend on ads?
The honest answer is that there is no single number that works for every business. But there is a right way to think about ad spend, and a wrong way.
In this guide, we break down how service businesses should approach advertising budgets, what actually matters when deciding how much to spend, and how to avoid wasting money.
Why ad spend feels confusing for service businesses
Most service businesses do not have a marketing background. That makes budgeting for ads feel risky.
Common concerns include:
Not knowing what return to expect
Fear of wasting money
Hearing wildly different advice online
Comparing to competitors without context
Without clarity, many businesses either spend too little to get results or spend without a system and lose confidence.
The biggest mistake businesses make with ad budgets
The most common mistake is choosing a number without a strategy.
For example:
“Let’s try $10 a day and see what happens”
“Let’s copy what another business is spending”
“Let’s just boost a few posts”
Ads are not experiments when your income depends on them. They are investments that need structure.
What actually determines how much you should spend
Ad spend should be based on your business model, not guesswork.
Your average job value
If your average job is $150, your budget logic is very different from a business with $3,000 jobs.
The higher your job value, the more flexibility you have with ad spend.
Your margins
Spending $1,000 to make $1,200 makes no sense.
Spending $1,000 to make $5,000 does.
Margins matter more than lead cost.
Your capacity
If you can only handle 10 new jobs per week, there is no point generating 50 enquiries.
Ad spend should match your ability to deliver work.
Your follow up systems
Businesses with strong follow up can afford to spend more because they convert more.
Without systems, even small budgets get wasted.
Typical ad spend ranges for service businesses
While every business is different, most service businesses fall into a few common ranges.
Small local service businesses
$20–$40 per day
Focus on consistency
Ideal for testing and early growth
Growing service businesses
$50–$100 per day
More predictable lead flow
Better data for optimisation
Scaling service businesses
$100+ per day
Multi-channel strategies
Focus on efficiency and volume
The key is not the number. It is whether the system behind it can convert.
Why spending too little often fails
Small budgets fail when:
There is not enough data to optimise
Ads do not run long enough
Results are judged too quickly
This leads to the false belief that ads do not work, when in reality the budget was never enough to support a system.
Ads without systems are expensive at any budget
Even large budgets fail without:
Landing pages built to convert
CRM automation
Missed call handling
Fast follow up
Spending more money does not fix broken systems.
Better systems make the same budget perform better.
How to think about ad spend the right way
Instead of asking “How much should I spend?”, ask:
How many booked clients do I want per month?
What is one new client worth to my business?
How many leads do I need to hit that number?
What system do I need to convert them?
This flips ad spend from fear to logic.
When ad spend becomes predictable
Ad spend becomes predictable when:
Leads are tracked
Conversions are measured
Follow up is automated
Campaigns are optimised consistently
At that point, spending more becomes a growth decision, not a gamble.
Want help setting the right ad budget?
If you want to know how much your service business should spend on ads, a Growth Plan Call is the fastest way to get clarity.
We look at:
Your job values and margins
Your capacity
Your current lead flow
What budget actually makes sense
No pressure. Just honest guidance.
Book a Growth Plan Call and stop guessing your ad budget.
