Strategy & ROI
How to actually calculate ROI with a marketing agency.
Most owners do this wrong. They’re comparing the wrong numbers.
The formula
ROI = (revenue from marketing leads − marketing cost) ÷ marketing cost.
If you spend $2,000/month and book $14,000 of work from those leads, your ROI is 6x. Anything above 3–4x in home services is a healthy marketing engine.
What you need to track
Five numbers. Every month.
- 01
Total leads
Every form, every call, every quote request. From every channel.
- 02
Cost per lead
Total spend ÷ total leads. The earliest signal that something is working or breaking.
- 03
Booked rate
What percentage of leads turned into jobs. This is on you, not the agency.
- 04
Average job value
Revenue per booked job. Multiply by booked leads = revenue.
- 05
Total marketing cost
Agency fee + ad spend + any tools. The denominator.
The trap
Most owners measure cost. The right number is payback.
A $3,000/month agency that produces $20,000 in booked work is cheap. A $500/month agency that produces $1,000 is expensive. Stop comparing fees. Compare what the fees return.
The bottom line
If you can’t see the numbers monthly, you can’t calculate ROI.
Demand the report. Then judge the agency on it, not on opinion.