Ad platforms surface dozens of metrics: impressions, click-through rate, quality score, cost per click. Almost none of them answer the one question that actually matters to a small business owner: is this campaign making more money than it costs. That answer comes down to two numbers, both of which most business owners already have, even without any marketing background.
The two numbers that matter
Cost per lead (total ad spend divided by number of leads generated) and the average value of a customer to the business. If a campaign costs $50 per lead and the average job is worth $500, even a modest closing rate on those leads makes the campaign clearly profitable. If a campaign costs $200 per lead against a $300 average job, the math is a lot tighter and worth scrutinizing.
Where cost per lead comes from
This requires conversion tracking to actually be set up correctly first. See what is a conversion, and how do you track one on a simple website? and how to set up goal tracking on a contact form. Without that foundation, cost per lead is a guess, not a number.
Don't stop at cost per lead, track close rate too
A campaign might produce cheap leads that rarely turn into actual paying customers, or more expensive leads that close at a much higher rate. Tracking, even roughly, what share of ad-driven leads actually become paying jobs is what turns cost per lead into a real ROI picture.
A simple way to track this without special software
A basic spreadsheet, logging each lead's source, whether it closed, and the job's value, is enough for most small businesses to see the real picture over time. It doesn't require marketing software, just consistent, honest logging.
Give it enough time and volume before judging
A handful of leads isn't enough data to draw a reliable conclusion about a campaign's real ROI. Enough volume needs to accumulate before the cost-per-lead and close-rate numbers mean much. See how long to wait before judging a website's performance.
Questions
What if I don't know my average customer value?
Look back at recent invoices or jobs and calculate a rough average. It doesn't need to be perfectly precise to be useful for this kind of decision.
Is a high cost per click automatically bad?
Not by itself. A high cost per click in a category where jobs are worth a lot of money can still be very profitable. Cost per click alone, without knowing the value on the other end, doesn't tell you much.
How often should I calculate ROI on an active campaign?
Monthly is reasonable for most small businesses, giving enough new data each time to be meaningful without requiring constant recalculation.