Advertising ROI Calculator
Running PPC Ads Is A Must!…Or is It?
There’s no question that online advertising is a vital part of any digital marketing campaign. It holds a particularly special place in my heart as the most important skill to master for it was the very first thing I ever learned to do as an intern at a digital agency. Now, after 7+ years of managing ads for various brands and individuals, it has become much more common knowledge that running ads is a must if you want to grow a business online…. or is it???
You see, as more and more people have started running ads on Google and Facebook, the cost per click has gone up. Where I recall running ads for around $0.10 per click, the same campaign now has to bid over $2 per click. This is important to note because not every campaign is profitable and if you start running ads before you are ready, you can end up losing a lot of money.
Why it’s important to set the right budget for your campaign
“The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency”
Bill Gates said it best when speaking about automation exposing inefficient systems. Ads, to me, are in a lot of ways a form of automation for your business. They help scale your current money-making business. But, if you do not know how to properly measure and define your budget for your ads, you could be setting yourself up to run a losing campaign. In an effort to make things as simple as possible, I have built a few calculators below that will help guide you on what data points you need to measure and how you can design a profitable ad campaign.
How to Use This Guide
CUSTOMER LIFETIME VALUE CALCULATOR
To begin, you will need to calculate your customer(s) lifetime value. This is an important metric to measure for it is how we will understand if we are truly generating a profit from our ad campaigns.
CUSTOMER LIFETIME VALUE CALCULATOR
To begin, you will need to calculate your customer(s) lifetime value. This is an important metric to measure for it is how we will understand if we are truly generating a profit from our ad campaigns.
SERVICE-BASED OR B2B AD SPEND & ROAS CALCULATOR
After you’ve calculated your customer LTV, I have provided two variations of my Ad Spend & ROAS calculators. The first one is primarily designed for businesses that focus on selling services and usually require additional steps to generate revenue beyond just a checkout on the site (like a consultation call or form entry). Any business that focuses on driving generating LEADS through its marketing campaigns should use the first calculator.
SERVICE-BASED OR B2B AD SPEND & ROAS CALCULATOR
After you’ve calculated your customer LTV, I have provided two variations of my Ad Spend & ROAS calculators. The first one is primarily designed for businesses that focus on selling services and usually require additional steps to generate revenue beyond just a checkout on the site (like a consultation call or form entry). Any business that focuses on driving generating LEADS through its marketing campaigns should use the first calculator.
E-COMMERCE AD SPEND & ROAS CALCULATOR
The second calculator is designed for e-commerce or subscription-based businesses where customers checkout directly on their site.
E-COMMERCE AD SPEND & ROAS CALCULATOR
The second calculator is designed for e-commerce or subscription-based businesses where customers checkout directly on their site.
Google Ads Keyword Planner
Use The Google Ads keyword planner to find your expected CPC.
Customer Lifetime Value Calculator
Service-Based Or B2B Ad Spend & ROAS Calculator
E-Commerce Ad Spend & ROAS Calculator
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I’m a Digital Marketer and Business Consultant. I write these blogs to help people like you make more money online. Check me out on social media for more tips and resources to help you with your online business.