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For home service businesses, the word “lead” can mean a lot of different things.
A homeowner who clicks an ad and fills out a form is technically a lead. So is someone who calls because their AC stopped working. But are they equally valuable? Not necessarily.
If you participate in networking, you may be like us and connected to BNI. So, think about it like a BNI referral. A referral can range between a 1 or a 5. In this case, Google or the search engine is the referrer (and we'd argue the best, most consistent one you'll ever have). A “1” might be someone who vaguely mentioned they need a plumber someday for that dripping guest room shower. A “5” could be a homeowner who has a burst pipe, knows exactly what they need, has the budget to address it and is ready to hire - today.
Both are referrals. They simply have different levels of opportunity. The same is true for marketing leads.
A good home service lead isn't necessarily someone who books immediately. Some jobs have longer lead time like a large-scale painting project or kitchen remodel complete with custom cabinetry.
Marketing often creates awareness before it creates a sale. (AKA impressions in case you're curious to know the industry lingo). Someone might visit your website today, compare three companies, read your reviews, talk to their spouse, and call you back 2-3 weeks later.
Another homeowner may call three companies at once and choose the first one who answers. And another may submit a form but never respond to your follow-up calls. That doesn't automatically mean the marketing failed.
That's why home service companies should look beyond simply counting leads and phone calls, and look at how today's opportunities and jobs can generate the same work in the future.
The quality of a home service lead generally comes down to several factors:
A lead that checks most of these boxes is closer to a “5.” While a lead that checks only one or two might be a “1” or “2.” Both still have potential—but they shouldn't be evaluated the same way. That's why we ask our clients about lead quality and converted jobs; they all matter.
This is where ROI conversations can get tricky.
A business might say, “We spent $2,000 on marketing and only got five leads.”
But the better question is: What should $2,000 realistically be expected to produce in this market, for this service, with this offer and our sales process/close rate?
Your marketing budget should be based on the economics of your business and your field to stay as competitive as possible — not simply what you wish you could spend.
We suggest starting with your average customer value, gross profit, close rate, and desired customer acquisition cost. Then work backward to determine what you can reasonably invest in generating opportunities.
For example, if your average closed job is worth $5,000, that doesn't mean every $1,000 spent on marketing should produce a $5,000 sale. There are too many variables. Marketing isn't a vending machine; you put in $X and don't automatically get $Y back.
If you don't invest enough to generate meaningful exposure and opportunities, there may simply not be enough activity to produce the results you're looking for.
At the same time, increasing your budget doesn't guarantee results! More traffic can mean more opportunities—but lead quality, competition, seasonality, offer, reputation, website experience, response time and sales follow-up ALL influence what happens next.
Instead of asking only, “How many leads did we get?” look at the entire journey:
Trust us, that's where the real story is! A campaign generating 20 leads that produces eight qualified opportunities, and four $10,000 jobs may be dramatically more valuable than a campaign generating 50 inexpensive leads that rarely turn into customers.
And remember: a lead isn't a closed job. Just like a referral doesn't guarantee business, a marketing lead doesn't guarantee a sale. The job is to create the right opportunities, follow up quickly, provide a great customer experience, and give qualified prospects a compelling reason to choose you.
For home service companies, the question shouldn't be, “How cheap can we get a lead?” It should be: “Can our marketing consistently generate the right opportunities at a cost that makes sense overall for our business?” That's ultimately a much better measure of marketing performance.
At My Marketing Works, we help trades and home service brands look at marketing as a system—not just a collection of ads, clicks and leads. Because a good lead is more than a form submission and a phone call doesn't mean they don't call back to cancel an hour later. It's an opportunity to create a customer.
And the better you understand the value of that opportunity, the smarter you can be about your marketing budget, expectations and ROI. And as your marketing partners, who actually care to see you grow – it's important to us that you understand how it all works together for your success.
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