Why Google Ads is Risky Business | Ep 47 | Trades Secrets: Contractor Marketing Podcast

Devon Hayes:

All right. Well, today’s topic is regarding Google Ads, and it’s a great topic. I think every contractor’s heard of them. They know what they are, the little ads that show up when you Google something, insane, I think is a smoking gun, and the answer to your prayers when you need leads fast. And Amanda is our Google Ads certified expert here. And this is a conversation we thought it would be good to have on the podcast because it’s not some silver bullet or smoking gun that’s going to solve all your lead problems, right?

Amanda Joyce:

Exactly. We hear from people a lot of times that are like, “Okay, SEO’s working. I love where it’s going. I’m starting to see the leads come in, but I need the volume now. So can you just light some ads up for me and then we’ll just wait it out until SEO kicks in and starts driving a larger quantity of leads for me.”

Devon Hayes:

And today we’re going to talk about why that’s not the answer.

Amanda Joyce:

Exactly.

Devon Hayes:

All right.

Welcome to Trade Secrets, where we demystify digital marketing to help contractors get the most bang for their marketing bucks.

Amanda Joyce:

This is for you, if you’re a contractor looking for actionable marketing insights.

Devon Hayes:

Learn from home services, industry experts to elevate your business through simplified marketing strategies.

Amanda Joyce:

Let’s dive into today’s trade secret.

But yeah, so point being, we can’t just turn on Google Ads overnight and just suddenly start filling your pipeline for a number of different reasons. If it did work that way, everyone would be doing it. And honestly, once upon a time, it did work that way a little bit more. Cost per clicks were cheaper many moons ago, but I’m going to back up for a second. I know you’d mentioned earlier, Devon, that Google Ads are the ads that pop up at the top of the search results. And historically they always owned that very top spot forever. And over the last couple of years, Google has made a lot of changes to the way they serve things up. Depending on your market, the service offering, all the things, there can be a number of different things that are really taking up that top spot.

So it really has shuffled the deck on all things search, but it has changed the game for traditional Google Ads. So now when you do a search in your market for a service offering, you might be served Google local service ads, which are those ads that typically do take up that top spot if they’re offering an ad. Right underneath it, you see the local 3-pack, you might see some organic results and then see Google Ads. So even just keeping that in mind, if you’re someone who ran Google Ads five years ago, and it works really well, and maybe you moved away from it, or maybe you’ve been running it the whole time, you’re like, “Why isn’t it working like it did five years ago?” That’s your answer right there. It really, it’s a different landscape than it once was. So I just always think that’s a good place to start as a baseline when we’re explaining this to people, because it’s not an apples to apples comparison of maybe what you would’ve been seeing historically.

Devon Hayes:

Yeah, and this whole conversation was sparked because I think it might be common knowledge now that SEO, an effective strategy, it takes a while to work, but we also understand the need to fill your pipeline while you’re waiting for that organic strategy to work. And so oftentimes, we’ll have a discussion around Google Ads, and as you were mentioning, it used to work a lot faster, but now it isn’t one of those things that you can turn on when you need leads and turn off when you don’t need leads anymore.

I think that conversation is one that we’ve been having with our clients or potential clients more and more. And I think that would be a really good, maybe, lead in as to why it isn’t some spigot that you turn on and off when you want to lead and when you don’t want to lead. And who doesn’t ever not want leads, but when they start to get really expensive in your pipeline as well. In this podcast, I know we’re going to dive into the pros and cons, but I would love for you to explain why it isn’t as easy as turning on and off the PPC spigot, so to speak.

Amanda Joyce:

Yeah, absolutely. So there’s a number of things that are at play here. One of which is seasonality. Almost everyone listening to this podcast has seasonality in their business. Whether you are a landscaper and it’s really heavily seasonal, or you’re a roofer, or an exterior contractor, or even a home remodeler, you’re going to have your times of year where business is flowing, and then there are your times of year where you’re pretty thirsty for leads. And that’s typically when we hear from people is when they’re thirsty for those leads.

We’re a month into slow season. They’re like, “Ah, my sales guys need something to do. I need to turn some ads on. What can you do for me?” And we’re like, “Okay, well we need about a month to build you proper landing pages, build out the structure of your campaign, really get it off the ground and get it running. By that point, we’re going to be two months into your slow season and then by the time we’ve tested for a month or two, we could be stepping straight into busy season by the time we’re even really off and running.” So it just doesn’t happen overnight.

Devon Hayes:

It doesn’t. And what do you mean, will you explain to everyone listening what you mean by testing?

Amanda Joyce:

Yeah.

Devon Hayes:

You’re like, “We have your campaigns built, we have your landing pages built, and now we have a month of testing.” What do you mean by that?

Amanda Joyce:

Yeah, and I should probably even start with the caveat that we never stop testing, but month one, talk about a test. It’s really like, okay, what even rides in this market? What keywords are going to convert? And we really do find that same industry, different market, different keywords convert, just like we do in SEO. So we might start out with the same framework of the campaign that we’ve tested in other markets, and we might find that people are problem-aware in some markets. Some people are solution-aware, some people are maybe going to, if you’re in a densely populated area, you’re more likely to type in the suburb you’re in after the service. And maybe somebody, maybe more out in a rural community, might just type in siting contractor, where maybe there where you are, Devon, they might type in siting contractor Lakewood because they don’t want someone from Highlands Ranch, they want someone that really serves their market.

So the only way we know that is testing it, and it’s not always a rule of thumb that it’s rural versus densely populated. So we have to figure out what keywords are even going to work there. So a really good example is a home builder that we’re working with right now, who we’re crazy about. They’re awesome. We actually, month one was a little brutal and month two, I’m really happy with the leads we’re sending over, and we’re constantly checking in and asking about lead quality, and he’s really happy with them and they’re getting better. Month one, we were testing a number of different keyword categories and then we figured out, oh, these are the ones that are working, and we just turned everything else off. So now we’re just going hard in the paint on the keywords that were really working for us in that market and he’s getting quality leads. So that was a short test, in three weeks we figured that out and it was awesome. But some markets it’s not that fast.

Devon Hayes:

Especially the bigger markets with more competition, I think, it’s brutal.

Amanda Joyce:

Exactly, and on top of it, in his market for his services, they don’t yet offer Google local service ads, so we’re not fighting… He’s getting some of that top. So it’s actually, in his market, the first thing I did was say, “Let’s look at Google local service ads,” which we’ll dive into at the end of this particular episode. But I was like, “Let’s dive in there first and then I’ll get your ads up and running.” Because it takes me a month to build up the landing pages, and the structure, and LSA, once you get through the background check, you can turn your ads on. So we go to try to apply we’re like, “Oh, they won’t even let them apply because they don’t do GC work in that market yet.” So we just focused on Google Ads and it’s worked out. It’s working for him. It’s also, we’ve only done it for a couple months.

Seasonality’s going to be interesting. That’s what’s working right now, but we have to keep it running. And hence what we’re talking about earlier, not just turning this spigot on and off because we might say, “Okay, these are the keywords that are killing it. Let’s turn them off because now you’re super busy, and then we’ll just turn them on again in July.” They might not be working as well in July. So having that annual year-over-year look at what’s working is a really critical data point to make decisions about advertising this same time next year. So I know for some people, it might not be in the budget to just run a few thousand dollars a month in Google Ads, and that’s okay if it’s not, but you just need to understand that you are really shuffling the deck on your own self if you’re turning it on and off like that. And you can’t look to your agency and expect them to be able to just snap their fingers and get you right back where you were when you turned it off six months ago. That’s not a realistic expectation.

Devon Hayes:

Mm-hmm. Mm-hmm. Yes. Yeah, that makes total sense. And even an agency like ours, we’re niche down. We focus on home services and we’ve got a lot of really good data from other markets, but things that are crushing it in South Georgia are not crushing it in Langley, BC. It’s just completely different even though it’s the same service offering. So while it’s great to have some data to work with, it doesn’t mean that we can take that, and apply it, and it will work for you. So it’s good to have a good base, a good, I guess, starting point and we will make sure… I know you do a really thorough job vetting those out and because even paid keywords, they’re not the same as organic keywords. They’re two completely different sets of keywords, which is also interesting because you’d think that there would be a lot of crossover and there really isn’t a ton.

Amanda Joyce:

Exactly, exactly. We always find some congruency, but the beauty of paid is that we can just come up with our list of keywords we think work, and put them up there, and we can bid ourselves into the top spot and find out if it works. Unlike SEO where we can’t be like, “We believe based upon all of our research, these are the keywords that are going to work and we’re going to chase them for the next six months, and then at that point we find out which ones convert.” So there’s a beauty to the fact that you can hop up there right away if you’re willing to pay the price to be up there. And you also have to think about what mindset you’re in when you’re clicking on an ad versus when you’re looking at organic search results, maybe clicking through the 3-pack and reading reviews. You’re in a different mindset set.

So you want to be there for both people. Maybe the person that’s top of funnel that’s really doing their research and thinking, and then maybe the person that’s like, “I just need somebody right now. I got to get on that. I want somebody to get out here and get me a quote.” They might click on that ad and that same person that’s casually looking at the search results right now, three months from now, might be ready to click on that ad.

Devon Hayes:

Yeah, it is just where they’re at in the funnel. You have to have different ad groups that speak to them, and it’s just a whole different beast in there. And why, and I know we push GLSA pretty hard on this podcast because it really is just the best thing for you as a contractor. It truly is. But say you are running Google Ads, what I think is so brutal is that just because they click on the ad, you’re just paying for that click. There’s no guarantees that that customer is then going to convert.

So this goes back a little bit to landing pages, and building them out, and the campaigns, and the verbiage we use on the landing page, and the images that we use, and the way they’re structured, the way they are and why they are. There is a method to the madness. Never drive to your homepage, we’ve said that a thousand times. You should have specific landing pages, but what, and I know the answer to this, but I’m asking you to share with everybody else, but how much does that one little click cost? I’m googling something, I’m Googling home renovations, and then I click on that top ad, and then I don’t fill out the form. How much does it cost the contractor for me to just click on that ad and then take no action?

Amanda Joyce:

Depends on the market and the service, but based on all the data points we have, we’ll see roofing, 80 to $90 for that click. Just for the click.

Devon Hayes:

Just for someone to click.

Amanda Joyce:

Depending on the market, but yes. Roofers, you’re all out there, you hear me, you’re listening right now. The whole industry did themselves dirty because everybody got in there and started bidding it up. It’s like any of the other markets that we’ve run things for in the contractor space are not as hard as roofing. Roofing has been so saturated over the years, probably seven or eight years ago, when it was the Wild West, and there were less people in it, and it was like the winning ticket and the silver bullet. There were some podcasts and some people going out to some different roofing expos and things, and telling everybody that Google Ads is where it’s at. Everyone listened, and got in there, and started jacking those prices up. So roofing, 70 to 80 bucks in your average market.

Devon Hayes:

Just for that one click.

Amanda Joyce:

I’m seeing some GC terms in some markets though. The client we were referring to is in Langley and we’re seeing clicks well under $20. So-

Devon Hayes:

Wow.

Amanda Joyce:

Yeah.

Devon Hayes:

And those are massive, massive projects that they’re doing.

Amanda Joyce:

Yeah, and that makes my job easier, when I have more budget to play with because if it’s costing me $80 a click, and even if we have a healthy conversion rate of 10%. So keep that in mind as well when you’re really mathing the math on whether you want to spend in Google Ads. If you were to run a test for a couple of weeks and just find out what the cost per click is in your market, and then turn it off, and decide you wanted to do the math, and decide if this was even something you want to keep chasing. Let’s say you figure out that the average cost per click in your market’s $50, just for easy math, for the services you want. So keep it in your mind that a healthy conversion rate in Google Ads is 10%. That’s real good. It’s higher than that on your brand terms, but on a service-based term, if you can consistently convert 10% of the traffic you’re driving, you’re doing good.

So you’d be looking at a $500 lead. So $500, cool, how many of those are you closing and how high quality are they? So start doing the math on that and say, “Okay, we close 60% of our leads, which of our services…” Maybe you are a roofer. That would be a cheaper click for a roofer, but fine, $50, you’re a roofer in you’re market. Is it worth it for you to bid on the repair terms? Because let’s say they cost $50 a piece too, and it’s costing you $500 to drive a repair lead. Are you looking at as the lifetime value of that customer, and you know they’re going to come back next summer and need a roof replacement, and you’re cool with spending that money right now, and knowing that you probably going to spend pretty much all of your margin on the lead to get in the door and give the customer a good feel, fix that leak or fix those loose shingles knowing that next summer they’re likely to call you and you can nurture them with email campaigns all year?

Cool, but if you really need to fill that pipeline and it is just not in your business model to be out there doing repairs that don’t lead to a full replacement, make sure you are, not only are you not bidding on repair terms, but whoever’s managing your ads is putting repair terms on negative in your account so that you do not show up for them, because it just isn’t going to make sense for your model. So I’m going off on a tangent here, but it’s just really important for you to really look at what reasonably it’s going to cost you to drive a lead, and then if that makes sense with the margins on those.

If you’re going to drive a roof installation lead for $500, that’s probably going to make sense, and you could probably do that all day long. But if your sales guys aren’t closing very well, you’ve got a couple guys that you’re sending out there and they’re just telling you none of the leads are closing, you probably need to rethink that once again, because if you’re going to spend $1,500 on three leads and they’re not closing them, it’s not going to make good [inaudible 00:16:15].

Devon Hayes:

[inaudible 00:16:15] it’s bit problematic. All is that to say, yeah, for a repair lead, it probably doesn’t make a lot of sense when they cost that much in roofing. But between our plumbers, electricians, I think we’ve seen some really strong… It’s a far less volatile market for remodelers, electricians, landscapers. It hasn’t been nearly as terrible as it is for roofers though, would you say?

Amanda Joyce:

Exactly, but we’ve also run into things with plumbers where a lot of them are like, even if the clicks are $15 and we have a healthy conversion rate, if someone’s looking for a pretty basic repair, they’re not looking to have a hot water system installed or something that’s a higher margin service, they are also saying, “I don’t know about the margins here.” However, lifetime value, if they decide you’re their go-to plumber, there’s something to be said for there. And then you can also use that same mentality to say, “Cool, the only thing I’m going to bid on, the only thing I’m even going to advertise on would be hot water installations because that’s the only thing that I have the margin to spend on these ads.”

So just making sure that you’re really looking at the books and looking at your numbers before you just dive in and start throwing money at it is just really critical, to just make sure it’s going to make sense with your business model or to just to know, okay, I got to test this for a couple months, but if we’re not hitting this cost per acquisition or this cost per contact on these types of service terms, we’re going to pause them. And then just go into it already knowing what success looks like and just watch it really closely. So I’m not totally hating on it. It can work. It definitely can, but it’s not going to be that, turn it on tomorrow for me agency, and fill my pipeline, and keep my sales guys busy. It’s not going to be like that.

Devon Hayes:

Yeah, and I think that’s the point of this conversation is we can do, it can work, it can be effective. You’re brilliant at it. I wouldn’t trust anybody else with my money, but it doesn’t mean that your pipeline’s going to be filled two weeks after turning the ads on. You’re investing for a couple months, but once they convert, or if they are going to convert for you, I know that you’ll be the one to do it for people. And I know you lose sleep over this, but it’s just, I think it’s important. There’s pros and cons to everything and sometimes, and I think we’ve seen this with our competitors too, they’re like, “Oh, just run Google Ads with your SEO strategy and it’ll work completely, and then that’s everything you need to do. It’s going to get your organic off the ground and blah, blah, blah. They’re going to convert. It’s amazing and it’s magical.”

It’s like… It’s not magical. It helps for a minute, but when you turn that off, your organic drops. It’s not like-

Amanda Joyce:

[inaudible 00:18:54].

Devon Hayes:

And the algorithm changes, and there is some favoritism going on, whether Google wants to say it out loud or not. But the point, again, of this podcast was just that we don’t want anyone thinking, to get sold some magical remedy for filling your pipeline while SEO takes its time to really ramp up and start seeing those leads convert and come through from the organic traffic. So-

Amanda Joyce:

A hundred percent. Yeah, and I think that’s something you and I struggle with a lot because we’ve heard a lot of… We’ve chatted with lots of different contractors, some of whom are now our clients, some of whom aren’t. But just great conversations we’ve had over the years with people that are like, “The agency I worked with before, the agency I was considering, was really pushing me on that,” and they were just like, “I didn’t really have the budget or the stomach for eight to 10 grand a month in ad spend on top of my SEO.” And I just think it’s really important to let people know that they can be mutually exclusive.

You do not have to just dump money down the Google Ads funnel to see SEO start doing its job. So step cautiously if someone’s trying to tell you that. And if they do, make sure the reporting they’re giving you is clearly dividing that traffic so you can really see, because sometimes that can really muddy the waters too where then suddenly it’s just like, look at all this traffic you’re getting from Google and they’re not separating it out. And if they’re being honest and separate out everything you’re paying for, it suddenly makes SEO not look so great.

Devon Hayes:

Yeah, especially when there’s a heavy ad spend, then your traffic is going to look amazing because you’re getting a ton of traffic through to your website. But number one, if they’re doing it properly, it’s paid traffic. And so it’s going to a very specific landing page, and then they don’t have the option to click out and go through the rest of the site where your content and copy, your words on a page, is hopefully selling them on your business over another business. And the other piece of it is, I forgot why I started talking about this, but with GA4 especially, you can really segment that traffic out. You could before with Universal Analytics, and this is just a tracking tool on your website, but with GA4, something that I’ve come to really love about it, even though we mourned the loss of Universal Analytics, is that you can see not only the traffic acquisition channels, but you can see the source and the medium from which they came.

So did they come from Google organic, being organic? Was it your Google business profile? That’s on the organic side, but on paid it will tell you the specific, was it paid social media, was it paid Google Ads? What was the medium and the source of their first visit through to your site? So any agency can give you that information, not just a picture of your overall website traffic, an increase in traffic, because those are vanity metrics. But the meat of the reporting is how much traffic was through paid media, how much was through or organic, or referral, or just direct traffic through to your site? You can look at all of that within GA4, but I’m getting down the GA4 rabbit hole instead of talking about Google Ads. So I’ll get us back on track here.

Amanda Joyce:

Yeah, so really, we teed this up at the beginning, really the last point we wanted to make was what Google local services ads are and why we think that this is a good spot for you to consider. If you’re not currently running them, if you’re pulling your hair out because your traditional Google Ads aren’t working, or you’re considering some kind of advertising, you’re not sure where to start, it’s a really good place to start. You can go watch our whole episode on it. We dive in on that, but like I was saying earlier, in a lot of the current search results, it’s the very top spot and it’s a direct phone call straight through to your business. [inaudible 00:22:50]-

Devon Hayes:

It’s got that little badge that says, “Google Guaranteed,” on it.

Amanda Joyce:

Yeah, exactly. Great point too, that to even advertise with them, you have to give them a background check for one of your business owners, and you have to provide license and insurance, and proof of all that. So it gives the searcher the warm fuzzies that Google’s already checked you out. So that alone, if you can have that badge on your website, that’s a great trust factor. So just going through the process is good anyway, but you’re paying per call for those. So talk about, earlier when we were saying 60 or $70 for a click on a roofing term in a lot of markets, we’re seeing 60 to $70 a call in those same markets, and you’re only paying for it when someone is actually calling you. You can dispute it if they’re drunk, if they’re calling to sell you something, if they’re looking for work, whatever it is, you can dispute it. So you’re only paying for legitimate leads.

Now, some of them could be a little onesie, twosie, repair lead or something. Maybe you have your targeting set properly, and they were driving through town, and so their phone was picked up in your target market, and they’re actually calling about a property 20 miles away, and they’re not a good fit. In a lot of cases, you’re going to just still have to pay for that because of the nature of the beast. But it is a more perfect system than the traditional Google system, traditional Google Ads that you’re just paying per click and hoping that they like your landing page, and they call or convert. So it’s a pretty simplistic form of advertising. There’s only so many lovers you can pull in there.

So you don’t necessarily need an agency to manage it for you, which is a really good thing, or you’re not needing to pay that high ticket value for somebody to babysit it for you, and you’re never going to beat that cost per call with any other marketing medium or paid media medium at this juncture, especially knowing that it’s somebody who’s so actively interested. Even if you were somehow driving calls off of a social ad or whatever, they’re not actively going to Google and typing your service in and calling you. We’d all take those leads all day, every day, if we could get them. So it’s what Google’s pushing. That’s why they’re giving it such a top spot. So it’s a really great thing to explore if you’re looking for a way to get into paid search marketing, but you’re wanting to make sure you’re keeping those costs under control.

Devon Hayes:

Yep. Yep. Beautiful. I’m going to derail us and we are just about to wrap up, but I was going to say for… It made me think about how I could see a case for Google Ads over GLSA, if you have a really visual business like a remodeling contractor and you have already invested in some beautiful photography of your work. I think that could make a case for Google Ads because that is such a visual sell. I think people want to see your work.

They want to see what you can do, and I think that buyer’s journey is a little bit different than someone who obviously needs an emergency plumber. They’re hitting click right away on the first thing that’s on their screen because they’ve got a burst pipe and it’s flooding their basement at the moment. But as you were talking, I was thinking of the client, and they were talking about the remodeler, and they have invested, over the years, in just really beautiful photography. And I think those landing pages really help convert because they had these just extraordinary images of their work. They’re a great contractor, they’ve got everything really buttoned up, but the visuals that someone sees when they’re like, “I want to remodel this,” or, “I want an addition,” or whatever it might be. So that would be my caveat to those GLSA ads, is just if you have a visual business, like you do these full custom kitchens and home renovations or additions, and custom homes, and you have beautiful pictures.

Amanda Joyce:

Yeah, exactly, and I think you make a good point there too, that no matter what, you’re going to have to test it and see what works. You can run all these categories, and one of the things we do find is sometimes we’re like, “Oh, surprising that that one always drives the junkie phone calls, that that particular category for this client drives the junkie…” So they might find, oh, the only people that are reaching out want to barely move a wall, and this is not working for me.

They do, in your profile, as you click through and want to look at the reviews and stuff, you can upload images to your GLSA account so people can see some of them. But to your point, in that buyer’s journey, a lot of people aren’t going to look up home remodeler near me and not even want to hit the website at all before they’re going to make that phone call. So again, testing, testing, testing, that’s the only way you’re going to find out. And in some cases you might find, oh, I want to run the LSA on this one category and then I want to run Google Ads on this other, because that’s where they’re working. But you don’t have to marry either one of them, you can decide which one works best for you.

Devon Hayes:

Date them for a while.

Amanda Joyce:

Exactly, take them both out for a steak dinner, figure it out. And you might decide that one of them is your drinking buddy and one of them is your romantic interest. Who knows? There’s room for both of them.

Devon Hayes:

That’s true. So we’ll have some good show notes in here. The quick and dirty of everything we covered, I think the pros and cons, but overall, the message today is don’t assume that Google Ads is your smoking gun. It’s not going to solve your lead gen problem and understand that it comes along with a lot of testing and learning.

Amanda Joyce:

Exactly, due diligence, and just like any part of your marketing mix, it’s not something you can sleep on. You just really have to monitor it, and keep in mind that it’s going to change over time, and you just got to ride the ride.

Devon Hayes:

Perfect. Now we’ll just send this podcast to everybody who wants to do Google Ads.

Amanda Joyce:

There we go.

Devon Hayes:

Okay, well, thank you so much for tuning in. If you found it helpful or think somebody else would, please share the episode. We appreciate you listening and being our faithful followers.

Amanda Joyce:

Yep, catch you next time, guys.

Devon Hayes:

Okay, bye.

Amanda Joyce:

That was today’s trade secret. Thanks for listening.

Devon Hayes:

Did you find this helpful? We’re just getting started.

Amanda Joyce:

Subscribe, and don’t miss our next reveal.

Devon Hayes:

Until next time.