About the Ad Budget Calculator
This ad budget calculator works backward from the sales you want to the advertising you need to buy. Enter a revenue target, your average order value, website conversion rate, click-through rate and cost per click, and it calculates how many orders, clicks and impressions the goal requires, what the total and daily ad budget will be, and the resulting cost per acquisition and ROAS.
It is built for e-commerce owners, founders and PPC managers planning a Google Ads, Meta or Microsoft Ads campaign, or pitching a budget to a client or boss. Adding your gross margin shows whether the plan actually makes money once product costs and ad spend are paid — a campaign that hits its revenue goal can still lose money.
The model assumes every click costs your average CPC and converts at your average rate. Use numbers from past campaigns or industry benchmarks, and treat the output as a starting budget to test and refine.
With the default inputs, the total ad budget needed is $18,750.60. Change any value above to recalculate instantly.
How to use the ad budget calculator
- 1Enter the revenue you want the campaign to generate.
- 2Add your average order value and site conversion rate from analytics.
- 3Enter the expected click-through rate and cost per click for your ad platform.
- 4Set your gross margin and the number of days the campaign will run.
- 5Read the total and daily budget, then check ROAS and profit before committing.
Formula and method
The calculator walks the funnel backward. The revenue goal divided by average order value gives the orders needed; orders divided by the conversion rate gives the clicks needed; clicks divided by the click-through rate gives the impressions needed. Each count is rounded up to a whole number because you cannot buy part of a click.
Total budget is clicks × average CPC, and the daily budget spreads it evenly over the campaign length. CPA is budget ÷ orders, ROAS is revenue goal ÷ budget, and the implied CPM is budget ÷ impressions × 1,000. Profit after ads is revenue × gross margin minus the ad budget.
- AOV
- Average order value
- CR
- Conversion rate from click to order
- CTR
- Click-through rate from impression to click
- CPC
- Average cost per click
Worked examples
$50,000 revenue goal at $80 AOV
$50,000 ÷ $80 = 625 orders. At a 3% conversion rate you need 20,834 clicks, and at 2% CTR about 1.04 million impressions. At $0.90 per click the budget is $18,750.60 — $625 a day for 30 days — giving a 2.67x ROAS and about $6,249 profit at a 50% margin.
Lead-gen style: 200 sales of a $250 product
$50,000 ÷ $250 = 200 sales. A 2% conversion rate needs 10,000 clicks, which at $2.50 CPC costs $25,000 over 60 days ($416.67 a day). ROAS is 2x and CPA is $125, leaving $5,000 profit at a 60% margin.
Thin margin plan that loses money
500 orders at a 1.5% conversion rate need 33,334 clicks, costing about $36,667 at $1.10 CPC — nearly double the revenue. ROAS is only 0.55x, so the plan loses about $30,667. Raising AOV or conversion rate is essential before spending.
Frequently asked questions
How much should I spend on ads?+
Start from the result you need, not a round number. Work backward from your revenue goal using your conversion rate and CPC, then check that the projected ROAS is above break-even for your margin. Many businesses also cap total marketing at a share of revenue, often 5–15%.
How do I calculate a daily ad budget?+
Divide the total budget by the number of days the campaign will run. Google Ads may spend up to twice your average daily budget on busy days but keeps the monthly total around daily budget × 30.4.
What conversion rate should I assume?+
Use your own analytics for the landing page or store. If you have none, e-commerce sites commonly convert around 1–3% of paid clicks and lead-generation pages often more; test with a small budget first to get real data.
Why is my budget so high?+
Budget is very sensitive to conversion rate and CPC. Halving the conversion rate doubles the clicks — and the spend — needed for the same revenue. Improving landing pages or raising average order value is often cheaper than buying more traffic.