Key takeaways
- Work backward from customers, not from a percentage.
- Use CPC and conversion rates to size spend.
- Check the result against margin.
Work backward from customers
To win 20 customers a month with a 5% visit-to-customer rate, you need 400 visits. At a $1.80 cost per click, that is $720 a month in ads, or $36 per customer.
Canadian considerations
Check against margin
If an average customer gives $90 of gross profit, a $36 acquisition cost leaves room. If they give $30, the plan loses money and needs a higher price or better conversion.
Review monthly
Adjust spend each month using actual click costs and conversion rates. Keep a reserve of 10 percent for testing new channels.
Free tool / Media buying
CPC Calculator What does each click cost me?
Questions about Paid Media Math
How much should a new business spend?
Plan for a higher percentage early, often 15 percent of revenue or more, while you learn.
Should I use Google or Meta first?
Start with search if people look for your service. Use social to create demand.
Do I need an agency?
Not at small budgets. Consider one when spend passes roughly $5,000 a month.
Key terms
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