The Core Question
The Advertising Landscape for Contractors
There are fundamentally two types of paid advertising for contractors:
Pay-Per-Click (PPC)
You pay when someone clicks your ad. The ad appears in search results.
Examples: Google Ads, Bing Ads, Yelp Ads
Pay-Per-Lead
You pay when someone requests a quote or contact. Usually through a platform's form.
Examples: Thumbtack, Angi (HomeAdvisor), Houzz
Google Ads
Cost Per Click
$5-50+
varies by market & service
Typical Monthly Spend
$500-2,000+
for meaningful results
Control Level
High
keywords, budget, targeting
The Good
- •High intent — People actively searching for your service
- •Top of page — Above the Map Pack and organic results
- •Full control — Budget, keywords, schedule, geographic targeting
- •Measurable — Clear data on clicks, calls, conversions
The Bad
- •Expensive — Competitive keywords can be $30-50+ per click
- •Learning curve — Easy to waste money if you don't know what you're doing
- •Requires attention — Needs ongoing optimization to perform well
- •Clicks ≠ customers — Not every click becomes a lead
Yelp Advertising
Cost Per Click
$3-15+
generally lower than Google
Typical Monthly Spend
$300-1,000+
Yelp often pushes for more
Reputation
Mixed
controversial among SMBs
The Yelp Controversy
The Good
- •People use it — Yelp still gets significant traffic for local searches
- •Lower CPCs — Often cheaper per click than Google
- •Category visibility — Ads appear when people browse categories
The Bad
- •Aggressive sales — Be prepared for persistent upsell calls
- •Review filtering mystery — Some reviews get hidden with no clear reason
- •Contract lock-in — Often pushed toward longer commitments
- •Less search volume — Smaller audience than Google
Lead Generation Platforms (Thumbtack, Angi, etc.)
Cost Per Lead
$15-100+
depends on service type
Lead Quality
Variable
shopping around is common
Competition
High
same lead sent to multiple pros
These platforms work differently: instead of showing your ad, they collect leads from people looking for services and sell those leads to multiple contractors.
The Good
- •Pay for leads, not clicks — Only pay when someone wants a quote
- •Easy to start — No complex campaign setup
- •Some lead info provided — Job details, contact info
The Bad
- •Shared leads — Same lead goes to 3-5+ contractors
- •Price shoppers — Many leads are just getting quotes
- •Race to respond — First to call often wins
- •Low conversion rates — Many contractors report 10-20% close rates
When Lead Gen Platforms Work Best
Head-to-Head Comparison
| Factor | Google Ads/LSA | Yelp | Thumbtack/Angi |
|---|---|---|---|
| Cost Model | Per click or per lead (LSA) | Per click | Per lead |
| Reach | Largest | Medium | Medium |
| Lead Quality | Higher (searching for you) | Medium | Lower (price shopping) |
| Competition | Your ad vs. others | Your ad vs. others | Same lead to 3-5 pros |
| Control | High | Medium | Low |
| Best For | High-ticket services | If you have great Yelp reviews | Smaller, quick-decision jobs |
How to Know If Your Ads Are Working
This is where most contractors fail. They spend money on ads without tracking whether it's actually working.
The Numbers You Need to Track
Cost Per Lead
Total ad spend ÷ number of leads received. If you spent $500 and got 10 leads, your cost per lead is $50.
Cost Per Customer
Total ad spend ÷ number of customers won. If you spent $500 and won 2 jobs, your cost per customer is $250.
Return on Ad Spend (ROAS)
Revenue from ads ÷ ad spend. If you spent $500 and made $3,000, your ROAS is 6x.
Lead-to-Customer Rate
Customers won ÷ leads received. If you got 10 leads and won 2 jobs, your rate is 20%.
The Rule of Thumb
Our Honest Recommendations
If you're just starting out (under 50 reviews):
Focus on getting reviews first. Ads work better when you have social proof. Consider Google LSA once you have enough reviews to look credible.
If you need leads now and have budget:
Start with Google Local Services Ads if you're eligible (requires verification). They're pay-per-lead, appear at the very top, and the "Google Guaranteed" badge builds trust. If you're not eligible, traditional Google Ads is the next best option.
If you do smaller jobs and want easy leads:
Thumbtack can work for handyman services, small repairs, and quick-turnaround jobs. Just know you're competing on price and speed. Track your numbers carefully.
If you have great Yelp reviews already:
Yelp ads might be worth testing. If you already have a strong Yelp presence, ads can amplify it. If your Yelp profile is weak or you have filtered reviews, fix that first.
The Bottom Line
Paid advertising works—when done right. The key is matching the platform to your situation: Google for high-intent, high-ticket services; lead gen platforms for smaller, quick-decision jobs; and always tracking your numbers so you know what's actually working.
But remember: ads are a lever, not a foundation. If your website is slow, your reviews are thin, or your follow-up is poor, ads will just amplify those problems.
Get the foundation right first: reviews, GBP, a website that works. Then ads become much more effective.