Advertising

What a small advertising budget can do for a local business, and what it cannot

Michael Rapino September 4th, 20265 min read

What a small advertising budget can do for a local business, and what it cannot

A small advertising budget can own a narrow set of searches from people ready to hire, inside a tight geography. It cannot cover every service you offer across every town you would drive to. Most wasted local ad money is not spent badly, it is spread thin.

The arithmetic is simple and people avoid doing it. Take your monthly budget, divide by a realistic cost per click in your category, and that is how many visitors you get. Now assume a sensible share of them contact you, and a sensible share of those become customers. If the answer is under one customer a month, the budget is not too small, the target is too wide.

How do I know what a click costs?

Run it for two weeks and read the invoice. Estimates from tools are ranges wide enough to be useless, and your actual cost depends on your area, your category and how many competitors are bidding that week.

What we can say from experience is that emergency and high value trades cost the most per click, routine services cost less, and any category where a national aggregator is bidding costs more than you expect. In a small market the total volume is low enough that a modest budget can genuinely compete, which is the good news that gets lost in advice written for cities.

What should I cut first?

Geography, then services, then match types. In that order.

Start with the towns where you actually want to work and where the drive makes money. A service business that takes every job within an hour is often losing money on the far half of that circle without knowing it. Then narrow to the two or three services with the best margin and the clearest intent, and let the rest of the site do the work for everything else.

Not sure your budget is big enough?

Tell us your area, your services and what a customer is worth. We will do the arithmetic with you and say plainly whether the number works.

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What quietly eats a small budget?

Broad match, mostly. Left unattended it will spend your money on searches loosely related to yours, and the search terms report is where you find out. We check it weekly on a new account and it is routinely the difference between a campaign that works and one that does not.

Where a small local budget leaks
The leakWhat to do about it
Broad match left unattendedRead the search terms report weekly and add negatives
Search partners or display left onSwitch them off in a search campaign
Every ad pointing at the home pageSend each ad to the page about that one service
A radius bigger than your real service areaCut to the towns where the drive makes money
Ads running at hours nobody answersSchedule to the hours a human picks up

The second thief is a display or partner network left switched on inside a search campaign, which spends a real share of the budget on placements nobody chose. The third is sending everyone to the home page. A person searching for one specific service should land on the page about that service, and every extra click between the ad and the answer costs you people.

A kitchen timer and a small stack of coins on a pale linen surface
Two weeks of real spending tells you more about your cost per click than any estimate tool will.

How long before I know?

Two to three weeks for a signal, six for a judgment. If a properly built campaign in a real category has produced nothing in a month, the problem is usually the offer or the landing page rather than the channel, and spending more will not fix either.

Judge it on contacts and booked work. Clicks and impressions tell you the machine is running. They do not tell you the business is better off.

What about the landing page?

Half of what people call an advertising problem is a landing page problem. The ad did its job and brought somebody who wanted the thing, and then the page they landed on made them work for the answer.

Match the page to the promise in the ad, word for word if you can. If the ad says emergency no heat calls, the page should say emergency no heat calls in its first line, show the phone number immediately, and not make anyone scroll past a company history to find it. Then keep the form to three fields. Every field you add on a page somebody arrived at from an ad costs you more than it does anywhere else on the site, because they had no relationship with you thirty seconds ago.

Should I run it myself?

Honestly, sometimes yes. A single service, a single town, a small budget and an owner willing to read the search terms report weekly can run a perfectly good campaign. Management fees are real money and on a very small budget they can be a large share of the total.

Where it stops being a good idea is when there are several services with different economics, when the account has been left unattended for months, or when nobody is going to look at it weekly. An unattended ad account is the most expensive thing on this list, because it keeps spending while nobody watches.

What we got wrong once

We inherited an account and left an old campaign paused rather than deleting it, and a later account level change reactivated it for eleven days. It spent on terms nobody had reviewed since the previous agency set them up. We caught it, refunded our fee for the month, and now we archive rather than pause anything we inherit.

If you want someone to look at where your budget is actually going before you increase it, that is part of the paid media work we do. How advertising sits beside the rest is on the Growth Engine page, and the plans are on the pricing page.

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