Is Google AdWords the Holy Grail for a Junk Removal Business?
Anybody who has followed me and the Junk Removal Authority YouTube channel for any period of time knows that I speak very highly of Google Ads (formerly AdWords). We owe a great amount of our success with Junk Doctors to the Google Ads platform. However, there have been changes over the years which have made Ads less of the homerun it used to be.
A bit of background: My partner, Christian, and I started Junk Doctors in 2012 with a pickup truck and trailer. At the time, we were primarily advertising only through Craigslist ads and door hanger flyers. In late 2012, I reached out on an internet forum for marketing help for my junk removal business. A gentleman who used to run a junk removal company suggested Google AdWords. I looked into the platform, liked what I saw, and built a campaign on my own.
At the time, you could rank in the top 2 or 3 positions for around $3 a click. I was one of the first on the platform at the time and competition was limited. The nice thing at that time was that acquisition cost was low. During that period, we were able to acquire a customer for about $20 of ad spend. You could make some great money then. That allowed us to build up our cash, get new trucks, and expand our business. Google AdWords was the primary driving force behind that success.
As the years passed, costs began to creep up until they got well above $10 per click. In that time period, we built up a sizeable enough business that we were able to stave off any challengers to the top spot on Google. We could and were willing to spend whatever we needed to maintain that spot. There is business to be had on the second and third rankings and acquisition cost is generally lower for those positions. However, there are some customers who call the first company on the list and, if your sales skills are strong enough, you can close them down without them calling anyone else.
However, times have changed. Here are the facts: If we had to start right now, in this current environment, with our financial resources, we would have to approach Google AdWords differently. AdWords is marginally profitable in the short term if you are off the truck. The customer acquisition cost has ballooned so high that if you don’t have other income from previous customers, contracts, SEO, or from an unrelated stream, then AdWords can quickly drain your bank account. You will get jobs. You will get happy customers. You will get repeat customers. You will get contracts. And you will build a business much faster than if you didn’t do AdWords. But you have to make it through the process too – you can’t grow if you run out of money.
So here is the bottom line: if you are looking to get into the junk removal business and want to grow a big business as quickly as possible, you must do AdWords. However, we recommend a cash reserve of at least $25,000 and/or income from other sources to keep feeding the beast. Are AdWords jobs profitable? Yes. They are quite profitable when you average their cost over a long enough period of time. However, you will see little to no short term profits. The real value of AdWords is its ability to bring you very large jobs from time to time, contract jobs, customer reviews, referrals, and repeat customers in the future. This is why AdWords is actually a long-term growth strategy instead of a short-term profit boost that many believe it to be.
Let’s say you are looking to get into business and you do not have $25,000 of cash reserves. Your next move depends on your income potential outside of your junk removal business. Let’s say you have good income potential, which we’ll define here as $60,000 a year or more. In this case, you should continue working that job and get as much O/T as possible or take on a second job until you have $25,000 saved up AFTER purchasing a truck and all other business startup expenses.
I also strongly recommend our Business Package. The business package will save you from astronomical expenses resulting from mistakes that we train you to avoid. Also included with the business package are operations manuals, video training, a year’s worth of consulting, and more help to start your junk removal business. It’s like you are purchasing a junk removal franchise without the long term commitment – and you get a business that is 100 percent yours.
Under no circumstances should an individual quit their current job if it is paying $60,000 or more before they are ready to go about this right. If you have the income potential, work a job until you are ready to approach this business correctly. Otherwise, you will add years to the period it takes to make you and your business become successful, and you increase the likelihood you will close your business down. I also recommend that you seriously consider starting your junk removal business before quitting your current job. Read my advice on that in this article.
Do not dabble in AdWords, period. Spending in smaller markets should be $1,000 to $1,500 a month. In larger markets, $2,000 would be on the low end. We’d like to see spending north of $3,000 or $4,000 a month to Google in larger markets. If you are unwilling to spend that amount, you should not try AdWords. Your spend will be far too low and you will both throw away your money and give yourself a false impression of the AdWords platform.
In short, if Google Ads is run right, it will work in any market throughout the country over a long period of time. Smaller markets tend to be easier to break into. I know of some small markets throughout the country with only one or two AdWords users who are paying $3 or $4 a click with acquisition costs around $20. It’s a no brainer for them. On the flip side, there are large markets that see acquisition costs north of $100.
If you have the other income or cash reserves, Ads is a go for you. But if you are a newer company without the large cash reserves or other income, then Ads in those expensive markets might not be the right thing for you. In that case, I would recommend a strong Search Engine Optimization strategy. The nice thing with aggressive SEO is that you only have to pay the SEO company and not Google as well. Though you might not get immediate returns from your SEO efforts, at least you can budget your monthly spend/income.
We here at JRA are ready to help with your SEO and AdWords management needs for your junk removal company. We’ve built a very successful junk removal business on our own and currently work with over 30 companies throughout the country. We’re ready to help your junk removal business reach massive success. Call us today at 919-617-1975!