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How Much Should a Local Business Spend on Google Ads?
"How much should I spend on Google Ads?" is one of the most common questions local business owners ask, and one of the hardest to answer with a single number.
Spend too little and you won't get enough data to know if it's working. Spend too much before your setup is dialed in and you'll burn through money fast with little to show for it.
Here's how to think through your budget the right way.
Start With What a Customer Is Worth to You
The right Google Ads budget is tied to one number: the value of a new customer.
If you're a plumber whose average job is $400, you can afford to spend a lot more per lead than a nail salon where the average ticket is $50. Budget should always be a function of what a customer is actually worth over time, not just the first transaction.
Ask yourself: what would I pay for a guaranteed new customer? That number is your ceiling for cost-per-lead. Work backward from there.
How Google Ads Budgets Actually Work
You set a daily budget. Google spends up to that amount each day showing your ads to people searching for your keywords. You pay only when someone clicks.
The cost per click varies depending on your industry, location, and how competitive the keywords are. A click for "emergency plumber Chicago" costs a lot more than a click for "gift shop Elmhurst." Supply and demand.
In the Chicagoland market, here's a rough range of what clicks typically cost across different categories:
| Industry | Avg. Cost Per Click (Local) | Suggested Starting Budget/Month |
|---|---|---|
| HVAC / Plumbing / Electrical | $8–$25 | $800–$2,000 |
| Legal / Financial Services | $15–$50+ | $1,500–$4,000 |
| Medical / Dental / Chiro | $5–$18 | $600–$1,500 |
| Restaurants / Cafés | $1–$4 | $300–$600 |
| Salons / Spas | $2–$7 | $300–$700 |
| Gyms / Fitness Studios | $3–$8 | $400–$800 |
| Retail (local/specialty) | $1–$5 | $300–$600 |
These are ballparks. Your actual costs depend on your specific keywords, your service area, and how well your ads and landing page are set up.
Why Underspending Is a Real Problem
A lot of business owners start with $200 or $300 a month to "test it out." In a competitive market, that budget will get spent in a few days, not enough clicks, not enough data, no real conclusions.
Google Ads needs volume to optimize. It needs enough clicks and conversions to learn what's working. Starting too small means you quit before the campaign ever has a chance to perform.
A roofing company in Glenview started their Google Ads with a $400/month budget. They got a handful of clicks but no calls and concluded "Google Ads doesn't work for roofing." We looked at their setup, wrong keywords, no call extension, landing page was their homepage. They rebuilt the campaign with a $1,200/month budget and a dedicated landing page. They booked four jobs in the first month.
Budget Isn't the Whole Story
Here's what most people miss: budget is just one variable. The others are:
- Keyword targeting: Are you bidding on terms that actually lead to calls?
- Ad copy: Is your ad compelling enough to get the click?
- Landing page: Does the page you send people to make it easy to contact you?
- Call extensions: Can people call you directly from the ad without clicking through?
A well-built $700/month campaign will outperform a sloppy $2,000 campaign. Budget matters. Setup matters more.
A Simple Starting Point
If you're new to Google Ads, a reasonable rule of thumb is to start with a budget that covers at least 100–200 clicks per month. That gives you enough data to see what's working and make informed adjustments.
From there, let the data drive the decisions. If you're getting solid leads at a cost that makes sense for your business, scale up. If something's off, fix it before adding more budget.
Find Out What Google Ads Should Cost for Your Business
We'll look at your market, your competitors, and your goals, and give you a real number, not a guess.
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