HVAC Demand Trends: Google LSA Revenue Performance - June 2024
👋 Hey, Jon here! This week, we’re diving back into Google LSA performance for the full month of June.
Note: This data is from a sample of ~20 businesses across the US. Shout out to Josh Crouch and his team at Relentless Digital, who partnered with us to measure lead-to-revenue from their organic and GLSA management services, enabling us to share these trends with you.
As a refresher, below is a summary of May’s performance:
Spend: +13%
Conversions: +19%
Customer Acquisition Cost: $339.81
Average Ticket: $3,600
ROAS Potential: 15.5x
ROAS Closed: 9.3x
Note that spend on GLSA increased 18% from May to June.
Conversions from GLSA Increased by 44% From the Prior Month
Lead volume from GLSA has now risen for three straight months:
63% increase from March to April
19% from April to May
44% from May to June
From February to June, lead volume from GLSA has increased 286%:
Also, the number of customers who Booked from GLSAs was up 51% MoM, the number of run jobs was up 35% MoM and the number of paying customers was up 43%.
Lead volume increases are a positive sign, but if that increase overwhelms your operations, or those leads aren’t converting, it becomes another vanity metric.
It’s worth noting that 57% of lead volume came in the last two weeks of the month, which likely means there will be a larger revenue pipeline to start the month of July.
Google LSAs Drove a 20.9x Return on Ad Spend Potential in June
In May, GLSAs drove $15.50 of revenue opportunity per $1 spent.
In June, that went up to $20.90 per $1 spent and the total revenue opportunity generated increased 45% MoM.
Efficiency and volume went up in June, although we did see a higher percentage of that revenue opportunity in the estimated and sold statuses:
Estimated / unsold estimate revenue: 35% of total revenue opportunity
Sold revenue: 23% of total revenue opportunity
Closed Revenue: 42% of total revenue opportunity
Estimated revenue volume was up 61% and sold revenue volume was up 314%, but closed revenue volume remained unchanged.
With a higher volume of leads coming in the back half of the month, it makes sense that more customers are still in the top parts of the funnel, which means July could be a record month for GLSAs in this sample, but time will tell.
Google LSAs Drove a 8.6x Return on Ad Spend (Closed Revenue) in June
Because total closed revenue volume remained unchanged while spend increased on GLSAs, closed ROAS came down from 9.3x in May to 8.6x in June.
Savvy analysts (which you all are since you read this newsletter every week 😊) will know that just because ROAS went down and closed revenue volume remained unchanged despite increased spend does NOT mean GLSAs underperformed in June.
It just means the additional volume is likely to impact July more than June, especially with the majority of leads coming in the second half of the month.
July is going to start with sold revenue equivalent to 57% of the total closed revenue generated in June.
It Cost $280.93 to Acquire a Paying Customer from Google LSAs in June
The customer acquisition cost from GLSAs hit a low in February before rising to another peak in April.
Typically, June is the least expensive month to acquire paying customers from paid channels, and while there’s been a steady and consistent decline in CAC since April, June is still the second least expensive month behind February.
It is worth noting that average tickets increased 6% month-over-month (to $3,800), but the key stat here is that average tickets have increased 49% since February.
While February was the least expensive month to acquire a paying customer from GLSAs, the average tickets were also significantly less compared to June ($1,300 less on average).
Again, many of the metrics viewed in a silo do not tell the full story. Would you rather pay $265 to acquire a paying customer who spends $2,500 on average, or $281 to acquire a paying customer who spends $3,800 on average?
Until next time . . .
-Jon