What’s a Good Cost Per Lead on Google Ads? (A Real Australian Example)

There’s no single “good” cost per lead on Google Ads — a A$35 lead can be a bargain for one business and a disaster for another. The honest answer is that a good cost per lead is one you can pay and still make money, judged against your lead value, close rate and margins. To make that real, here’s an actual Australian account we ran, how it stacks up against the published benchmarks, and a simple way to work out your own number.

What “cost per lead” actually means (and the trap most accounts fall into)

Cost per lead (CPL) is simple maths: ad spend divided by the number of leads. The problem is the word “leads.” Most accounts quietly count the wrong thing.

In the account above, Google reported nearly 3,000 “all conversions.” If we’d judged it on that, the cost per “lead” would have looked incredible — and completely fake. Most of those were page views, scrolls and micro-events, not someone actually asking for the service.

We counted 217 primary leads — quote forms, real WhatsApp conversations and tracked phone calls. That’s the number that can turn into revenue, and it’s the number we optimised towards. If your CPL looks suspiciously cheap, the first thing to check isn’t your bidding — it’s what you’re calling a lead.

A real Australian example

This was a Melbourne home-services business (carpet, couch, mattress and pet-stain cleaning), running Google Search only.

(Figures from the account’s Google Ads export, all-time view. Average lead value of ~A$250 was supplied by the business. No closed-sale revenue was shared, so this isn’t a revenue-ROAS claim — it’s cost per genuine enquiry.)

How that compares to the published benchmarks

Here’s where it gets useful — and where you have to read benchmarks carefully.

On the face of it, this account is dramatically cheaper and converts roughly 3× better than the published median. But before you screenshot that: WordStream’s figures are US dollars, US campaigns, median across thousands of accounts, and “Home & Home Improvement” isn’t a perfect match for a cleaning business. It’s a reference point, not a target.

Two honest takeaways:

1. A strong account can beat the median comfortably — but only when the fundamentals (clean tracking, tight intent, the right structure) are right.
2. Benchmarks can flatter or punish you for the wrong reasons. If this account had counted all 3,000 “conversions,” its CPL would have looked unreal next to any benchmark — and every budget decision made off that number would have been wrong.

So what’s a “good” cost per lead for you?

Forget the industry average. A good CPL is one that leaves room between what you pay for a lead and what a lead is worth. Work it backwards:

1. Average lead value — what an enquiry is worth, factoring in how many you close and the value of a job.
2. Target CPL — a fraction of that value that leaves healthy margin.
3. Volume — enough leads at that CPL to actually matter to the business.

In the example, the business put average lead value at roughly A$250. A lead at A$34.82 is about 14% of that — roughly a 7:1 lead-value-to-CPL ratio before you even get to close rate. That’s the kind of unit economics worth scaling. And notably, Google flagged the campaign as limited by budget while sitting on target — meaning the constraint wasn’t efficiency, it was how much the business was willing to spend.

So the real question isn’t “is A$35 a good cost per lead?” It’s “what’s a lead worth to me, and am I paying a sensible fraction of that?”

Five things that actually move your cost per lead

1. Track real enquiries, not engagement. Calls, forms, messages and booked jobs — not page views. Clean conversions give the bidding algorithm the right signal.
2. Build around service intent. Someone searching “carpet cleaning near me” is telling you exactly what they want. Separate services so the keyword, ad and landing page line up.
3. Use negatives aggressively. Block job-seekers, bargain-hunters, DIY and the searches that will never buy.
4. Give people more than one way to enquire. Form, phone and WhatsApp all count — local customers choose based on urgency.
5. Measure by service, not just the campaign total. A blended number hides which services carry the account and where the next scaling opportunity is.

Frequently asked questions

What is a good cost per lead on Google Ads?

A good cost per lead is one that’s a sensible fraction of what a lead is worth to you — not a fixed benchmark. As a rough guide, if a lead is worth A$250 to your business, paying A$35–50 for it leaves healthy margin. Published medians (e.g. WordStream’s US$70–90 for home services) are reference points, not targets.

How much should Google Ads cost for a local service business?

It depends on your average job value and how many leads you can handle. The useful way to budget is to set a target cost per lead based on lead value and margin, then spend as much as you can while staying on that target — many good local accounts are limited by budget, not by demand.

Why does my cost per lead look so cheap (or so expensive)?

Usually it’s a tracking problem. If you’re counting “all conversions” (page views, scrolls), your CPL will look unrealistically cheap. If you’re only counting one narrow action, it can look expensive. Count genuine enquiries to get a number you can trust.

Is a 22% conversion rate on Google Ads realistic?

It’s well above the typical median (~7%), but achievable on tightly structured local-service campaigns with high-intent keywords and clean tracking. It’s not guaranteed — it’s the result of the fundamentals being right.

Related case study: The full Local Services case study — 217 leads at A$34.82 CPL

Related: 217-lead case study · Google Ads management · Marketing for tradies