Where it comes from
The figure traces to Google's own economic impact reporting, produced for Google by an outside consultancy, and Google's own advertising channels promote it. It is not independent research and was never presented as such; it becomes misleading only when it is repeated as though a neutral party measured it.
That is worth saying plainly and then leaving alone. A company publishing a favourable figure about its own product is doing marketing, which is allowed. Quoting it back at a client as evidence is a different act.
What an average of everybody conceals
Suppose the figure is accurate as an average. It still pools a supermarket chain bidding on its own brand name, a software company with a global market, a charity, and a local plumber. Brand bidding alone produces enormous ratios cheaply, because those people were going to buy anyway.
Strip that out and the number for a local service business competing on generic terms against three other local firms looks nothing like the headline. It might be better. It is certainly different.
The only ratio that matters is yours
And unlike the industry figure, it is completely knowable. You need three numbers, all of which you already have:
- Average job value. Not the big one you remember, the average.
- How many quotes become work. Count a month of them honestly.
- What you spent to get those enquiries.
Those three give you a break-even cost per enquiry, which is the figure that actually decides whether a campaign is working. There is a calculator for it here; it runs in your browser and asks for nothing.
Once you have that number, the industry average becomes irrelevant, which is the point. You stop asking whether Google Ads works in general and start asking whether it works at your job value in your postcode, which is a question with a real answer.
Questions
Are you saying Google Ads does not work?
No. We run it, and on the right trade at the right job value it works well. The objection is to a number produced by the seller of the product being used as though it were a neutral finding about your business.
Is there an independent figure we could use instead?
Not a UK one at industry level. We wrote a whole page on why: the regulator that obtained the real figures redacted them. See whether a UK cost-per-lead benchmark exists.
What return should a trade business expect?
Whatever your own arithmetic says is break-even, plus enough margin to be worth the trouble. For a high job value like a roof replacement the required conversion rate is low and the maths is forgiving. For a fifty pound call-out it is brutal, and the honest answer is sometimes that paid search is the wrong channel for that job.