Ad budget calculator

How the number is worked out

Clicks are the budget divided by the cost per click. Enquiries are clicks multiplied by the landing page conversion rate, and cost per enquiry is the budget divided by enquiries. Customers are enquiries multiplied by the enquiry-to-customer rate, and cost per customer is the budget divided by customers. Revenue is customers multiplied by the average order value, gross profit is that revenue multiplied by the gross margin, and the verdict is gross profit less the budget.

Benchmarks worth comparing against

A worked example, with the arithmetic shown

A B2B firm sets a $4,000 monthly media budget. Its cost per click is $4.00, its landing page converts 3% of visitors into enquiries, sales close 20% of those enquiries, the average first deal is worth $3,000 and gross margin is 40%.

Clicks are $4,000 divided by $4.00, so 1,000. Enquiries are 1,000 multiplied by 3%, so 30, which makes cost per enquiry $4,000 divided by 30, or $133. Customers are 30 multiplied by 20%, so 6, at a cost per customer of $667. Revenue is 6 multiplied by $3,000, so $18,000. Gross profit is $18,000 multiplied by 0.40, so $7,200. The verdict is $7,200 less the $4,000 budget: $3,200 of profit.

Now double only the conversion rate, from 3% to 6%, and leave the budget alone. Enquiries become 60, customers 12, revenue $36,000, gross profit $14,400, and the verdict $10,400. Tripling the budget instead, to $12,000, would have produced $9,600. The landing page beat three times the money.

How to read the result

Cost per enquiry is the figure to watch while a campaign is live, because it arrives weeks before the revenue does and it is the earliest honest signal you get. Cost per customer is the figure to plan with. Compare it against the gross profit a customer leaves behind, which the marketing ROI and ROAS calculator works out from the same inputs.

Keep management fees out of the budget field. The funnel maths assumes every dollar entered buys clicks, so a fee mixed into the budget silently inflates your cost per click. Add the fee to the verdict afterwards, when you are judging the whole programme rather than the media.

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How small is too small, and what sits outside the budget

A budget that buys under a hundred clicks a month cannot produce a readable result. At LocaliQ’s 2026 all-industry average of $5.42 a click, $500 a month buys about 92 clicks, which at a 3% conversion rate is fewer than three enquiries.

Three enquiries is not a trend, and no amount of optimisation will turn it into one. Either raise the budget until the monthly enquiry count reaches double figures, or narrow the targeting until the cost per click falls far enough to get there on the money you have.

Two costs belong outside the budget field on purpose. Management fees, whether an agency retainer or your own hours, go against the verdict rather than into the funnel. And the landing page is a build cost, not a media one. If the worked example convinced you that the page is the strongest lever available, price that work separately instead of taking it out of the media budget and weakening both.

What this calculation does not account for

• The learning period. A new campaign performs worse than its steady state for the first few weeks, and cost per click usually rises as you scale past the cheapest audience. Plan on the steady-state figures, budget for the ramp.
• Creative and landing page quality. Two campaigns with identical budgets and identical costs per click can differ threefold in conversion rate. That single variable dominates every other one in this model, which is why the worked example above ends where it does.
• Repeat business. Only the first purchase is counted. A subscription or repeat-purchase business will look worse here than it is.
• Minimum viable budget. A budget that buys thirty clicks a month cannot produce a readable result, whatever the calculator says. If your expected enquiry count is in low single figures, you are running a test that will take a quarter to conclude.

When to stop calculating and talk to someone

Stop when the verdict is positive only under assumptions you cannot defend. If the plan needs a 9% landing page conversion rate to break even, that is not a budget you should commit, and the honest next step is fixing the page. Our website development service exists partly because so many paid campaigns fail on the destination rather than the ad.

Stop, too, when the platform choice is doing more work than the numbers. The mechanics of running spend well differ by channel, and our guides to Google Ads and LinkedIn Ads cover what changes between them. If you would rather hand the whole thing over, the digital marketing service takes it on and the published retainer prices on the offers and pricing page exclude ad spend, so the budget you model here stays the budget you spend.

One thing worth saying plainly: a campaign that loses money at every plausible conversion rate is telling you something useful for free. Bring those numbers to a free consultation and we will say so rather than sell you the campaign.