Cost Per Lead vs Cost Per Booked Job: What Matters

Your marketing dashboard shows $75 cost per lead. Your agency calls it a win. You’re spending $3,000 a month and getting 40 leads.

Except you booked 6 jobs from those 40 leads. At $3,000 in spend, that’s $500 per booked job. And two of those jobs were under $300 in revenue.

The CPL looks great. The math doesn’t work.

Why CPL became the default metric

Marketing agencies love CPL because it makes campaigns look successful. A $75 lead feels affordable. A $500 booked job feels expensive, even when it’s the same campaign producing the same results.

CPL became the industry standard because it’s easy to measure. Someone fills out a form, you count a lead, you divide by spend. Clean, simple, defensible.

The problem is that CPL ignores everything that happens after the form submission. It treats a tire-kicker researching prices the same as a homeowner whose AC died this morning. Both count as one lead. Both cost the same. One becomes a $5,000 installation. The other ghosts your callback.

The conversion gap nobody talks about

Home service businesses convert leads to jobs at wildly different rates. The industry average sits around 7.8%, but that number hides massive variation.

Emergency services convert higher because the customer has an immediate problem. A burst pipe or dead furnace creates urgency that overcomes objections.

Replacement sales convert lower because the customer has time to shop around. They’ll get three quotes, maybe more. Price becomes the deciding factor when there’s no emergency forcing a decision.

Lead source matters too. A referral from a past customer might close at 40%. A lead from a home service marketplace might close at 5%. If you’re tracking CPL alone, a $50 marketplace lead looks cheaper than a $100 referral. In reality, the referral costs $250 per booked job while the marketplace lead costs $1,000.

The math completely inverts when you measure what matters.

How to calculate cost per booked job

Start with your total marketing spend for a channel or campaign. Include everything: ad spend, agency fees, software costs, even the time your office manager spends following up.

Divide by the number of jobs you actually booked from that source. Not leads. Not estimates. Jobs with signed contracts and deposits.

A campaign that costs $2,000 and produces 30 leads with a 15% close rate books 4.5 jobs. Cost per booked job: $444.

A campaign that costs $1,500 and produces 15 leads with a 30% close rate books 4.5 jobs. Cost per booked job: $333.

The first campaign has a lower CPL ($67 vs $100). The second campaign has a lower cost per booked job. If you’re optimizing for CPL, you’d double down on the first campaign and cut the second. You’d be making the wrong choice.

The attribution problem

Calculating cost per booked job requires knowing which marketing source produced each job. This is where most contractors get stuck.

“How did you hear about us?” is the question everyone asks. The answers are unreliable. Customers don’t remember. They say “Google” when they mean Google Ads, Google Maps, or organic search. They say “the internet” when they found you on Yelp. They forget that their neighbor mentioned you three months ago and credit the Facebook ad they saw last week.

Phone tracking helps. Unique numbers for different campaigns let you attribute calls to sources. But phone tracking misses the customer who saw your truck, looked you up on Google, and called your main number.

CRM integration helps more. When your marketing tools talk to your job management software, you can trace the path from first touch to booked job. But most home service CRMs weren’t built for marketing attribution, and stitching together the data requires time and technical skill most contractors don’t have.

The contractors who figure this out gain a serious advantage. They stop funding campaigns that produce cheap leads and no jobs. They double down on sources that book work profitably.

What good attribution looks like

An HVAC contractor in Texas ran Google Ads and Facebook Ads simultaneously. Google Ads produced leads at $85 each. Facebook produced leads at $45 each.

The obvious move was to shift budget to Facebook. Cheaper leads, more volume.

When they tracked through to booked jobs, the picture changed. Google Ads leads closed at 22%. Facebook leads closed at 8%. Cost per booked job from Google: $386. Cost per booked job from Facebook: $562.

They shifted budget to Google, accepted fewer total leads, and booked more jobs at lower cost.

This only works when you track beyond the lead.

The lifetime value factor

Cost per booked job still isn’t the full picture. A $400 cost to book a $300 drain cleaning looks unprofitable. A $400 cost to acquire a customer who spends $8,000 over five years looks like a steal.

Home service businesses with maintenance agreements, recurring services, or replacement cycles need to factor customer lifetime value into the equation.

The math gets more complicated but also more accurate. If your average customer is worth $4,000 over their lifetime and you can acquire them for $500, you’re running at 8:1 return. That same $500 spend looks very different if your average customer does one job and disappears.

Contractors with high LTV can afford higher acquisition costs. They can outbid competitors on advertising because they’re playing a longer game. The plumber who converts a drain cleaning customer into a maintenance agreement customer into a full repipe customer can afford $200 per lead. The plumber treating every job as a one-time transaction can’t.

Why your agency might resist this

Marketing agencies get paid to deliver leads. They optimize for CPL because that’s what clients measure them on.

Switching to cost per booked job changes the relationship. The agency now shares responsibility for what happens after the lead comes in. They’ll push back on lead quality, response time, sales process, and pricing. Some of that pushback is valid. Leads that sit for 48 hours before followup don’t convert regardless of quality.

The agencies worth keeping will embrace the shift. They want to optimize for outcomes, not vanity metrics. If your agency fights against measuring what matters, ask yourself what they’re hiding.

Getting started with better measurement

You don’t need perfect attribution to start. Even rough tracking beats pure CPL.

Tag your leads by source when they come in. Google Ads, organic search, referral, Facebook, whatever. Get your team trained on asking and recording the answer.

Track those leads through your job management software. Most CRMs let you add a source field. Use it.

Run a monthly report: leads by source, jobs booked by source, revenue by source. Calculate cost per booked job for each channel.

You’ll find that some sources outperform their CPL numbers and some sources dramatically underperform. Shift budget accordingly.

The contractors who make this shift typically find 20-30% of their marketing spend going to sources that produce leads but not jobs. Reallocating that spend to what works compounds over time.

The metric that matters

CPL tells you how much it costs to start a conversation. Cost per booked job tells you how much it costs to earn revenue.

Every contractor tracking only CPL is flying blind on the number that actually determines profitability. The agencies and platforms want you focused on lead volume because that’s what they can control and take credit for.

You control what you measure. Measure what matters.

Key Takeaways