Marketing is an essential investment for any business, but measuring return on investment (ROI) isn’t always straightforward for service-based businesses, professional service firms, and SaaS companies.

Unlike businesses selling physical products, service-based companies deal with longer sales cycles, relationship-driven revenue, and intangible value, making it harder to pinpoint exactly how marketing contributes to growth.

So, what’s considered a “good” ROI in marketing for service-based businesses? How do you measure it? And what benchmarks should you aim for? Let’s break it all down—no MBA required.

What is Marketing ROI, and Why Does It Matter?

Marketing ROI (Return on Investment) is a simple formula that tells you whether your marketing efforts are making you money:

In other words, how much do you get back for every $1 you spend on marketing?

For example, if you spend $5,000 on marketing and generate $20,000 in revenue directly attributed to those efforts:

A 300% ROI means you earned $3 for every $1 spent. Sounds great, right? But what’s realistic for service-based businesses?

What’s a ‘Good’ ROI for Service-Based Businesses?

While product-based businesses often aim for a 5:1 or even 10:1 return, service-based businesses tend to have different benchmarks due to higher customer lifetime value (CLV), longer sales cycles, and variable pricing models.

Industry-Specific ROI Benchmarks

Industry average ROI Goal – Why It Differs

Professional Services (Law Firms, Consulting, Accounting, Marketing Agencies, etc.) 300-500% (3:1 to 5:1 ROI) High-value services, longer decision-making cycles, and referral-based growth.

Service-Based Businesses (Coaching, Home Services, Wellness, Training, etc.) 400-600% (4:1 to 6:1 ROI) Often subscription-based or high-repeat business, increasing lifetime value.

B2B SaaS Companies 500-800% (5:1 to 8:1 ROI) Recurring revenue model leads to higher returns over time.

B2C SaaS Companies 300-500% (3:1 to 5:1 ROI) Lower initial costs, but strong long-term retention drives higher returns.

Important: ROI isn’t just about immediate sales. Many service-based businesses rely on brand awareness, referrals, and reputation building, meaning marketing results can take months to fully materialize.

Why Measuring ROI is Harder for Service-Based Businesses

Unlike retail or e-commerce businesses, where direct sales per ad click can be tracked, service-based businesses deal with intangibles that make ROI harder to calculate.

Here’s why:

Longer Sales Cycles – A law firm or consulting agency might take weeks or months to convert a lead into a client.
Multiple Touchpoints Before Conversion – A prospect might engage with your business 5-10 times (reading a blog, watching a webinar, speaking with a consultant) before committing.
High Customer Lifetime Value (CLV) – If you spend $500 on marketing to acquire a customer who spends $10,000 over 3 years, the true ROI plays out over time.

Solution: Instead of focusing only on immediate ROI, track Marketing-Attributed Revenue and Customer Lifetime Value (CLV).

If your average client spends $2,000 per year and stays for 5 years, your CLV is $10,000—which means paying $1,000 to acquire them isn’t bad.

How to Improve and Track Marketing ROI

1. Identify the Most Profitable Marketing Channels

Not all marketing efforts generate the same ROI. Track and compare these channels:
SEO & Content Marketing: Low upfront cost, but long-term high ROI (5:1 or more).
Google Ads & Paid Search: Can deliver 3:1 ROI if targeted well.
Email Marketing: Highest ROI (up to 40:1) when done right.
LinkedIn Ads (for B2B): Typically, a 3:1 to 6:1 ROI for professional services.

Pro Tip: Use tracking tools like Google Analytics, HubSpot, or UTM tracking to attribute leads to specific marketing efforts.

2. Set Realistic ROI Goals Based on Your Industry

If you run a consulting firm, don’t compare your marketing ROI to an e-commerce brand. Instead, set benchmarks that align with your industry’s norms.

Example Goal Setting:

If your current ROI is 1.5:1 (150%), aim for 2.5:1 (250%) over the next 6 months.
If you acquire a customer for $1,000 but they bring in $8,000 in revenue, your ROI may look low initially, but over time, it’s strong.

3. Optimize Your Marketing Spend

If your ROI is too low, don’t just throw more money at marketing—optimize your approach:

Increase conversion rates: Improve website design, CTAs, and lead capture.
Cut underperforming ad spend: If a channel isn’t delivering, reallocate funds.
Improve audience targeting: Use data to refine who sees your ads.
Focus on retention & referrals: Keeping customers is cheaper than acquiring new ones.

Example: If SEO brings in leads at half the cost of paid ads, shift more budget there.

ROI is a Long Game for Service-Based Businesses

In marketing, there’s no “one-size-fits-all” ROI number—it depends on your industry, sales cycle, and long-term value per client.

Professional services should aim for 3:1 to 5:1 ROI—SaaS businesses often higher.
Don’t just measure short-term ROI—track customer lifetime value.
Identify and invest in your highest-return marketing channels.
Marketing ROI is a long-term game—optimize continuously.

With the right strategy, your marketing doesn’t just generate leads—it builds a business that scales. Strategy is our jam. Now that you know it’s all about strategy, not just tactics, we’d love to help! Reach out for a complimentary review to see if we’re a good fit!

What’s a ‘Good’ ROI in Marketing? Benchmarks for Professional Services