There are a lot of ways to market your cleaning business. With so many marketing strategies to choose from to advertise your cleaning business, it can be hard to know what methods are worth it. If you’ve ever wondered what metrics you should track when advertising a cleaning business there are many that you should know. In this post you’ll learn important metrics you should track when advertising your cleaning business.
Determine the average value of a customer
One of the first metrics you need to figure out before determining anything else is what is the average value of a customer. This means that you determine what kind of revenue a new customer will generate for you on the first purchase from you.
It’s extremely difficult to determine the value of any kind of marketing effort for your cleaning business until you know this metric. Without knowing what the average sale brings in, you can’t know when something is profitable.
This holds true on all kinds of aspects of your cleaning business not just on the marketing end. For example, you won’t know if you can afford to hire new employees to expand if you don’t know what each new customer is worth to you.
Advertising your cleaning business is just one of the many aspects impacted by the average revenue per customer. Determine what that is as soon as possible.
Understanding the average lifetime value of a customer
Similar to the average value of a customer is the average lifetime value. This is another one of those base metrics you need to know as soon as possible as it also impacts many aspects of your business.
A residential cleaning business model not only includes one-time cleaning services, but also recurring services. This is especially true if you work in the commercial cleaning space.
There aren’t many commercial businesses that need one-time cleaning services. You may use one-time services or specialty cleaning services for both residential and commercial to get in the door. From there you can upsell these one-time clients into your recurring services.
With that said, knowing the true lifetime value of a customer is very important when it comes to expansion and advertising your cleaning business.
Calculating the average lifetime value of a cleaning client
To calculate this simply take your average revenue per customer and multiply that by how many services they usually buy as a customer.
Let’s take an example with a residential cleaning business that makes $200 for the first cleaning and you also make that each month on recurring services. In this example customers typically stay customers for two years. With those numbers, you would take 24 x $200 = $4800.
With a commercial business, it could be $1000 a month for two years. The math is the same and you would take 24 x $1000 = $24,000.
This will help you determine what promotional and expansion activities can be profitable. Even if you aren’t breaking even on an initial sale, the repeat sales on customers can make your efforts profitable.
Know metrics like cost per click, impression, phone call, view, etc. when advertising a cleaning business
These metrics can pretty much all be lumped into one category but they are all important. The basic idea is to determine what the cost of a specific action is.
What action is most important to your cleaning business depends on what your goal is for advertising your cleaning business. For example, if you are just going for initial exposure, and brand awareness for your business, cost per impression and cost per click are important. These show how often people are either seeing your ad or how often they are clicking on ads once they see them.
If you are running ad campaigns involving video marketing, cost per view, video completion rate, and average watch time are other important metrics.
You’ll also likely want to set up call tracking numbers specific to your advertising strategies. It can be very difficult to track phone calls from advertisements unless you have a separate number for them.
There are many services such as Callrail that can be used to set up tracking phone numbers. Using a number like this can help track costs per call as well. Whatever your ad goal is, determine the associated actions to go with it to know what metrics are important to track.
Similar to the cost per click metric is click-through rate or CTR. This metric helps you to understand the overall effectiveness of your advertising.
The click-through rate is the number of times people see your add and actually click on it to get to the place you wanted them to go. A way to calculate this is to take the number of clicks on an ad and divide by the impressions, or times it was seen.
Clicks/Impressions = Click-Through Rate
If your click-through rate is very low it can be an indication that your ad is not resonating with the people you are targeting. This could mean a variety of things. For example, you could be targeting the wrong people, your ad copy could be boring, the benefits you are speaking to might not be benefits your customers want, and so on.
CTR isn’t the only important metric to measure while advertising your cleaning business, but it is a key metric to consider and to use to improve your marketing strategy.
With the above metrics in hand, the next important metrics to start calculating are conversion rates. This applies to both your lead conversion rate and customer conversion rate.
If you don’t know how often your site visitors convert into leads, and then how often those leads convert into customers, you won’t be able to calculate the future metrics we cover in this post.
Knowing your conversion rate can also help you to adjust your marketing strategies and improve things like your sales followup process and even your customer service.
To calculate your lead conversion rate you simply take your leads and divide that by the visitors to your landing page.
Leads/(Landing Page Views) = Lead Conversion Rate
To calculate your sales conversion rate that is when you take your customers divided by the number of leads it took to get them.
Customers/Leads = Customer Conversion Rate
Knowing the value per lead can determine when advertising a cleaning business is profitable
Now that you know the above metrics for advertising a cleaning business you want to determine what is your average value per lead. To calculate the value per lead you will need to know your average value per customer and your conversion rate.
Once you have those numbers your value per lead is simply your average value per customer multiplied by the conversion rate.
Average Value Per Lead = Averages Value Per Customer x Conversion Rate
You can also use this same formula to calculate your average lifetime value of a lead. This is important to know for cleaning services that have a recurring aspect to them, such as daily, weekly, or monthly cleaning services.
You can calculate the average lifetime value per lead as the average lifetime value per customer multiplied by the conversion rate.
Average Lifetime Value Per Lead = Average Lifetime Value Per Customer x Conversion Rate
Cost per lead when advertising your cleaning business
After your marketing and advertising for your cleaning business have been running for a while you can start to learn what an average cost per lead is. This is a simple metric to calculate and it is just how much you spend on advertising before you get a lead.
Each ad will have its own cost per lead. The cost per lead can vary for a lot of reasons and depending on your advertising strategy you can adjust aspects of your ads to improve this number
For example, with Facebook ads, you can set up multiple ad sets with different targeting. Each one of these targeting methods may result in a drastically different cost per lead. You might even have different images that perform better than others in a given ad.
Pay close attention to your cost per lead as it can be an indicator of what tactics are working and which aren’t. One thing to note is that your cost per lead doesn’t necessarily tell the whole story.
For example, you may have one lead source that is much more expensive at the cost per lead level, but the conversion rate to customers is much higher. In this case, it could still make sense to run that ad even with a higher cost per lead.
Determining your break-even point on advertising your cleaning business
When you know your cost per lead, and your value per lead, you can determine your break-even point on your cleaning business advertising. This break-even number is essential to know to determine the overall success of your advertising campaigns.
The break-even point is going to be when your value per lead is equal to your cost per lead. You can also determine the lifetime value break-even point when your lifetime value per lead is equal to the cost per lead.
There are two points in your break-even point that you should know. One is when you break even at the cart. What this means is that you are breaking even by getting conversions less than or equal to what you are paying to get them on an initial sale.
Breaking even at the cart is very difficult to do and often you will only have a few ads that ever achieve this result. The good news is that with a cleaning business you have many opportunities to make sales beyond just the first sale.
You can upgrade clients on additional services and have recurring services, daily, weekly, monthly, and even annually depending on the service. With these repeat sales in mind you can lose money trying to break even at the cart, but still, be profitable within the lifetime of the customer. Try and keep your cost per lead below the lifetime value of the customer in the worst-case scenario.
Return on investment while advertising a cleaning business
When you are running paid ads to scale your cleaning business or using other forms of marketing, there is a cost associated with that.
Sometimes it may seem hard to justify a marketing strategy, but if you know your return on investment or ROI it can make sense. One thing to note though is that some marketing strategies can be very difficult or almost impossible to determine an ROI from prior to actually running the campaign.
For example, ROI on things like paid advertising with Google ads or Facebook ads can be determined as you go, but are often difficult to predict in advance. Certainly, you can base some predictions on past results from other cleaning businesses, but each market is unique and different.
A better formula to use is, return on ad spend, or ROAS. This is calculated by taking the revenue generated from an ad campaign and dividing it by the cost of that campaign.
Revenue/Cost Of Advertising = Return On Ad Spend
Typically this metric is best used when you are running paid ads to advertise a cleaning business. For example, if you made $1000 in revenue and spent $500, your ROAS = 1000/500 = 2 This means for every $1 you put advertising your cleaning business, you get $2 back.
What is the ROI from SEO?
SEO and search engine marketing is a popular way to promote a cleaning business. It works, but the return on investment can be very hard to calculate before the work is done.
Often on our marketing agency branch, we’ll get questions like “What is the ROI on SEO services?” or “How long will it take to rank on page one of Google?” The reality is that SEO is not an exact science like many people think it is.
Google and other search engines are constantly changing their search algorithms and the exact factors that cause a page to rank well today may be different tomorrow. With that said, some ranking factors typically stay similar throughout the years, so if you are wondering if SEO for cleaning companies works, the answer is yes.
However, it’s a long term process and it can be hard to give exact numbers of results or ROI in advance because it is a dynamic marketing strategy. SEO for cleaning companies is both an art and a science that, while hard to calculate exact returns upfront, can create a steady flow of organic traffic for your business.
Why calculating ROI from SEO isn’t a simple process
For example, let’s say you were trying to rank for a term like “commercial cleaning services.” As you can see in the picture below, a rough estimate for the traffic of that term is around 7,000 searches a month.
Now if you know all of your above metrics like conversion rate for leads, and conversion rate for customers, and you got all 7000 visitors you might have an idea of what kind of return you might get. However, that isn’t the full story because that 7000 is across the United States, so the true search volume for your specific area might be drastically smaller.
Not to mention you likely have competitors going after the same search term. This means that even if you optimize for that term you might only get a portion of that local traffic. The good news is that most cleaning business owners aren’t doing this kind of SEO optimization, so if you have content that is optimized for the right terms, you likely can expect to get a big portion of the traffic.
Also, understand that ranking well in search can take months. Google doesn’t recognize brand new content or new websites immediately, so it could take anywhere from a few months to a year to maximize the potential of a post.
So while there is a definite ROI on SEO services, it is nearly impossible to guarantee specific results or determine ROI prior to creating the content. Also if a marketing company is giving you exact numbers and time frames of how soon you can rank for terms, and things like that, they are most likely lying to you just to get your business.
Having proper expectations of results with your average ad spend costs
While not quite a metric, there are some other things to keep in mind when advertising a cleaning business. A big aspect of advertising a cleaning business that many people overlook is having proper expectations when it comes to ad spend and the results with it.
For example, we run into a lot of cleaning business owners who think that spending $1000 a month on Google Ads is going to make their phone ring off the hook. The reality is, that you may get a few extra calls a week at that level.
Let’s say that the average cost per click on a Google Ad for your commercial cleaning business is $15. Well if you take $1000/30 days = $33.33 per day. If you average $15 a click, that means you only get approximately 2 clicks per day.
Obviously not everyone who clicks will call your business, become a lead, or become a customer. So while this level of results isn’t amazing, it is still going in the right direction and it can lead to an increase in conversions and be profitable. However, expecting a budget of that level to get dozens of calls a day isn’t realistic for feasible.
The same goes for running Facebook ads as a residential cleaning company. If you only spend $300 a month on ads, and your cost per lead is $15 per lead then you might only get around 20 leads a month. It’s better than nothing, but you most likely are only going to get 1 or 2 customers from that kind of ad spend. Again, not amazing, but it can still be profitable.
Overall, the metrics you track in your cleaning business marketing are important, and knowing how you use them can give you a better idea of what is working and what isn’t. The better you track your metrics the more you can adjust appropriately and optimize your results with digital marketing.
Not only is knowing what metrics you need to track important but also having proper expectations of what is possible with your marketing. Advertising a cleaning business can get technical and it might require some outside help like working with a marketing agency such as ours.
P.S. If you are struggling to get quality leads for your cleaning business, Click Here to Learn How to Get More Clients for your business with these Top 10 Lead Sources For Cleaning Business Owners.