Quick answer: Most HVAC companies invest 3–12% of annual revenue in advertising/marketing.
- Maintain your current size: ~3–5%
- Grow ~15–30% YoY: ~6–12%
- Aggressive launch/new market: 12–20% (for 3–6 months)
Always sanity-check the % with CAC math (cost to acquire a customer).
Why your advertising budget matters
Owners don't buy "marketing"—they buy jobs. Your budget should answer one question:
How many calls, estimates, and installs will this spend reliably create at a profitable CAC?
If the answer isn't clear, the budget is just a guess.
Two ways to set your budget
A) % of revenue (fast)
Use % of revenue to set a ceiling, then pressure-test with CAC.
- Maintain: 3–5%
- Grow: 6–12%
- Aggressive (new city/division): 12–20% (time-boxed 3–6 months)
Formula: Monthly Budget = (Annual Revenue × Target %) ÷ 12
B) Jobs-first (more accurate)
Start with how many new jobs you want, then apply a target CAC.
- CAC: Advertising Spend ÷ New Customers
- LTV:CAC: Aim for ≥ 3:1 on service (installs can tolerate higher CAC).
Example (service):
Avg ticket $500, gross margin ~50% → ~$250 gross profit.
Target LTV:CAC ≥ 3:1 → CAC goal ≈ ≤ $80.
Example (install):
Avg ticket $11,000, gross margin ~30–40% → CAC $600–$1,200+ can pencil.
Formula: Monthly Budget = Target New Jobs × Target CAC
HVAC benchmarks (owner-friendly)
Use the % ranges and CAC math together:
- Maintain: steady pipeline, defend brand → 3–5% of revenue
- Grow: steal share, add techs/crews → 6–12% of revenue
- Aggressive: launch new city/division → 12–20% (3–6 months)
Sample monthly budget by revenue & goal
| Annual Revenue | Maintain (3%) | Grow (8%) | Aggressive (15%) |
|---|---|---|---|
| $500k | $1,250/mo | $3,333/mo | $6,250/mo |
| $1M | $2,500/mo | $6,667/mo | $12,500/mo |
| $3M | $7,500/mo | $20,000/mo | $37,500/mo |
| $10M | $25,000/mo | $66,667/mo | $125,000/mo |
Channel costs: what to expect
(Ranges vary by city/season/creative; use these to plan tests.)
High-intent capture (ready-to-book)
- Google Search (PPC): lead costs ~$60–$250+. Strong for emergencies & brand terms.
- Google Local Services Ads (LSA): pay per lead ~$25–$100+; great for service jobs.
- Bing Search: cheaper CPC in some markets; smaller volume.
Own your demand (compounding)
- SEO & Content: retainers $1.5k–$5k+/mo; posts $150–$600. 3–6 months to spin up; compounding returns.
- Reviews & Listings: modest tooling; improves conversion from all channels.
Demand gen (fill the top)
- Meta (Facebook/Instagram): promos/financing; lead forms can work with fast follow-up.
- YouTube/CTV: strong for brand & seasonality; tight geo + offer required.
- Direct Mail/Valpak: $0.50–$1.00 per piece + design; target tight ZIPs; track with QR/vanity URL.
Low-cost compounders
- Truck wraps: $2k–$5k/vehicle; amortize over 3–5 yrs.
- Yard signs, door hangers, magnets: pennies per impression; juice close rates in neighborhoods.
- Referral rewards: $25–$100 gift cards/credits; some of the best CAC you'll ever get.
Example monthly budgets
Use these as starting points—then shift dollars monthly based on booked jobs and real CAC.
$1M shop (grow mode, 8% ≈ $6.7k/mo)
- $3,000 Search/LSA (service + emergency + branded)
- $1,500 SEO/content (2–3 posts + technical upkeep)
- $1,000 Meta (seasonal promos, financing)
- $500 Reviews/listings & giveaways
- $700 Experiments (YouTube, targeted mailer)
Sanity-check: If blended CAC target is $100, budget $6.7k should buy ~67 new customers.
$3M shop (grow mode, 8% ≈ $20k/mo)
- $10,000 Search/LSA across service + install intents
- $4,000 SEO/content (pillar + 4 posts; service-page refresh)
- $3,000 Meta/YouTube (creative, remarketing)
- $1,000 Reviews/community sponsorships
- $2,000 Experiments (CTV, ZIP-level mailers)
Tracking & attribution (don't skip)
- UTMs on every ad/link; send to service + city landing pages (not the homepage).
- Call tracking + recording (LSA, PPC, mailers) → grade lead quality.
- CRM/Calendar capture (Housecall Pro/ServiceTitan/Google Cal): source every job.
- Weekly scorecard: Spend, leads, booked jobs, CAC, revenue, gross margin.
If you're missing after-hours calls, fix that before adding spend. RepairZen triages "no-cool" & leaks, captures details, and books right to your calendar—even when you're on a call or off the clock.
FAQs
How much should a new HVAC company spend on ads?
Time-box 12–20% for the first 3–6 months to build awareness and reviews, then settle to 6–10% as organic and referrals grow.
What's a good CAC for HVAC service?
Target ≤ $80–$120 in most markets; installs can tolerate $600–$1,200+ if close rates/margins hold.
Is SEO or PPC better for HVAC?
Both—PPC captures emergency demand now; SEO compounds and lowers blended CAC over time.
Ready to book more jobs automatically?
RepairZen captures after-hours chats, triages issues, and books to your calendar.