Cost per acquisition, not cost per lead

Most firms set a lead budget by feel and then argue about CPL. Do it the other way round: start with your gross margin and work backwards to the highest price you can rationally pay.

1 Step one: know your true job margin

Take an average job value, subtract materials, labour, subcontractors, scaffolding, warranty provision and finance costs. What is left is what marketing can spend from.

2 Step two: measure the funnel you actually have

3 Step three: do the arithmetic

• Gross margin per install: £1,800
• Target marketing share of margin: 25% → £450 per install
• Installs per 100 leads: 8 → 100 leads may cost up to £3,600
• Maximum sustainable CPL: £36

4 Step four: review monthly, by vertical and postcode

• Track cost per install by vertical, not blended
• Split by postcode group — travel time changes the maths
• Separate new-lead spend from re-quote and referral work
• Kill any source that misses target two months running

“Working it back from margin was the first time we could say no to a supplier with a number rather than a feeling.”