Owned and Operated - A Plumbing, Electrical, and HVAC Business Growth Podcast

Episode #232: Buying $200,000 in Leads - Is It Worth It?
Release Date: August 12, 2025
Host: John Wilson
Guest: Sam Preston, CEO of Service Scalers

Introduction

In Episode #232 of the "Owned and Operated" podcast, hosts John Wilson and Sam Preston delve into the intricate world of lead generation for home service businesses. Titled "Buying $200,000 in Leads - Is It Worth It?", the episode addresses whether hefty investments in purchased leads can drive substantial growth compared to relying solely on organic lead generation methods.

Lead Generation: Buying vs. Organic

John Wilson kicks off the conversation by highlighting the perennial debate between purchased leads and organic lead generation. He emphasizes the challenge of relying solely on organic leads:

"[00:00] John Wilson: We think about leads a lot. Like, it's kind of an obsession... If you can just go buy the lead, you just go buy the lead."

Sam Preston advises against spreading resources too thin and suggests focusing on channels that yield the best returns:

"[00:10] Sam Preston: Don't spread yourself too thin. Like, don't just do everything."

The hosts agree that identifying and capitalizing on effective lead channels is crucial. They advocate for "capping" successful channels to maximize their potential, essentially pouring resources into what works best.

Marketing Budget Strategies for Different Business Sizes

Listeners posed questions about optimal marketing budgets for varying business scales, with insights particularly focused on smaller companies.

Listener Question 1: "How should a smaller company less than $500k stand out with a marketing spend of $1k to $2k a month?" (Jenna Harris)

Sam Preston recommends against hiring agencies for smaller budgets, suggesting grassroots efforts instead:

"[03:55] Sam Preston: ...don't use that on an agency. Like, you're just not going to get very much out of that relationship."

He advises leveraging free resources like YouTube to learn about Local Services Ads (LSA) and Google My Business (GMB), and investing in platforms like Nextdoor for local engagement. John Wilson concurs, adding that smaller businesses can innovate effectively with limited resources by focusing on content creation:

"[05:18] John Wilson: ...TikTok Organic would be really interesting... content creation is super underutilized."

Listener Question 2: "How can I spend $5k to $10k a month on leads if LSA is only giving me zero to one leads per week?" (Robert Brooks)

Sam Preston suggests testing various lead aggregators like Angie's List and advises maintaining flexibility in budget allocation to explore what yields the best results. He emphasizes the importance of cycle management in LSA:

"[07:00] Sam Preston: LSA is pay per lead, so if you're not getting leads, you won't be paying for it... get started right now."

John Wilson shares his experience transitioning from a $4 million construction business to a $6.5 million electrical service company, illustrating the effectiveness of reallocating resources based on demand and lead sources.

PPC (Pay-Per-Click) Effectiveness and Optimization

Listener Question: "Is PPC dead? If not, what should be focused on to increase conversions other than optimizing the landing page, especially without strong brand awareness?" (Brendan Grant)

Sam Preston firmly asserts that PPC is far from dead, citing that 75% of their clients are "on track" with their PPC campaigns:

"[32:27] Sam Preston: The majority of our clients are hitting... 75%... on track."

He acknowledges the increasing difficulty for smaller companies to compete in PPC due to larger competitors but maintains that with proper management, PPC remains a viable lead source. John Wilson echoes this sentiment, expressing his surprise at the sustained effectiveness of PPC:

"[33:09] John Wilson: That's a lot. Yeah, yeah, PPC is not dead."

Both hosts emphasize the necessity of continuous optimization and the challenges inherent in managing PPC campaigns without professional assistance. Sam Preston recommends always partnering with an agency for PPC management, as it's too complex to handle internally.

Choosing the Right Marketing Partner

Listener Question: "How to assess which marketing company to partner with, considering the abundance of options in the home service space?" (James Stone)

Sam Preston provides a structured approach to selecting a marketing agency:

1. Ownership of Assets: Ensure that all marketing assets remain under your control to maintain accountability.

2. Fair Fee Structure: Evaluate whether the agency's fees are proportionate to the services and results provided.

3. Industry Understanding: The agency should have a deep understanding of the home service industry and your specific business model.

"[39:16] Sam Preston: Our fee is roughly two grand a month. Minimum retainer to run PPC... somewhere between, like, maybe it is worth it to go pay nine grand to Scorpion if they get you the roas."

John Wilson adds the importance of verifying the agency's experience with businesses similar in size and scope to yours, and suggests probing questions and client interviews to assess competence.

Importance of Google Map Pack Rankings

Listener Question: "How important is ranking top three in Google Map Pack for local service businesses?" (Mark Mag)

Both hosts agree that ranking high in the Google Map Pack is critical for visibility and lead generation. John Wilson emphasizes their substantial investment in Google My Business (GMB) optimization:

"[45:34] John Wilson: We spend thousands of dollars a month on our GMBs. We're driving insane amounts of leads and we're still growing."

Sam Preston predicts that AI advancements will further amplify the importance of GMB rankings, making it an even more vital component of local SEO:

"[46:18] Sam Preston: How you're able to optimize your GMB is going to be bigger than it is currently... invest in that."

Website Optimization and SEO Post-Redesign

Listener Question: "I recently had my website redone and leads have kind of fallen off." (Justin Beam)

Sam Preston identifies potential issues related to website redesign, such as broken URLs affecting SEO rankings. He advises maintaining URL structures or implementing proper redirects to preserve search engine rankings.

"[46:30] Sam Preston: Specifically, it's probably a link issue... keep those URLs the same."

John Wilson shares a practical solution using Chrome's Wayback feature to retrieve old URLs and ensure continuity in SEO performance.

"[47:39] John Wilson: Now, the way we solved this is we used Chrome's look back... pull the old URLs off it and rematch it."

Conclusion and Key Takeaways

The episode concludes with John Wilson and Sam Preston summarizing their strategies and future plans, including a 30-day series aimed at doubling profits and leads for home service businesses.

Key Takeaways:

1. Invest Smartly in Lead Channels: Identify and capitalize on effective lead generation channels, whether purchased or organic, without spreading resources too thin.

2. Optimize Marketing Budgets Based on Business Size: Smaller businesses should focus on grassroots methods and gradual scaling, while larger companies can afford to invest more heavily in multiple channels.

3. PPC Remains Viable: Despite increasing competition, PPC is still an effective tool when managed correctly, preferably by experienced agencies.

4. Select Marketing Partners Carefully: Ensure agencies understand your industry, have fair pricing, and retain ownership of marketing assets.

5. Prioritize Google Map Pack Rankings: High rankings in local search results are essential for visibility and lead generation.

6. Maintain SEO Integrity During Website Redesigns: Preserve URL structures or implement redirects to avoid losing SEO rankings post-redesign.

Notable Quotes:

• "If you're really relying on organic leads to drive traffic, I feel like that's kind of playing on hard mode." — John Wilson [00:00]

• "PPC is not dead. The majority of our clients are hitting... 75%... on track." — Sam Preston [32:27]

• "One of the best bang for your buck investments is your GMB." — John Wilson [44:35]

For more insights and actionable advice on growing your home service business, visit www.ownedandoperated.com.