// Tools

How much media budget do you need?

Calculate how much media budget you start with on Google, Facebook, Instagram or LinkedIn, how you grow to your target and when you recover your advertising costs.

Step 1 of 4

What do you need to get started?

What should your ads deliver?
Where do you want to advertise?

Revenue excluding VAT. In the case of a subscription: what a customer pays in the first year.

€

What remains of the turnover after purchasing or production. An estimate is good enough.

%

Think of hosting, maintenance, a subscription or follow-up orders. Nothing? Enter 0.

€per year

Of the 10 Requests If there is one customer, that is 10%.

%

An application can cost up to €250 to break even.

Example: €5,000 at the first sale × 50% gross margin × 10% of the requests that the customer makes. That is your break-even CPL (cost per lead).

€250

CPL (cost per lead) = your advertising costs ÷ your number of requests.
The slider is set to your maximum (break-even). Are you already advertising? Set it to what a request costs you now.

To get started€3,800 to €4,600per month, approximately €125 to €150 per day

This is expected to result in 15 to 18 applications per month.

Step 2 of 4

Your growth path

Your goal in the long run; you start lower.

How quickly do your customers usually decide?

From the first click on your ad to the application. That determines how quickly the platform can learn.

Step 3 of 4

What does it yield?

Step 4 of 4

The sky is not just the limit

Steps 2 and 3 are calculated with an equal amount CPL, No matter how far you grow. In practice, your CPL Often, they leave. First, you reach out to people who are already searching or quickly deciding. If you want to reach more people, the platform needs to do more research: people who know you less well, need more convincing, or have seen your ad before.

When that starts and how hard it is varies per market and per campaign. That cannot be predicted. Therefore, choose a percentage below and see what it does to you. CPL and your result.

You can also push it. With ads that work better, and by bringing more people into your customer journey: campaigns that first build awareness and interest, ensure that more people already know you. Those respond easier, so you CPL remains lower.

Every doublingTwo times as much budget is not twice as much Requests
  1. Start18 applicationsCPL €250
  2. 2× budget35 applications instead of 36CPL €258
  3. 4× budget69 applications instead of 73CPL €265
  4. 8× budget134 applications instead of 146CPL €273

Per month, 3% more expensive per doubling. Scroll down to change it.

3%

We start at 3%, a rule of thumb. At 0%, your CPL stays the same, as in step 3.

  • Break-even: what a request or purchase can cost to recover each new customer on the first sale. That is the gross profit on the first sale, multiplied by the proportion of requests that become customers. What a customer generates afterwards counts in step 3.
  • The price slider starts at that break-even point. You only know what a request or purchase actually costs when you advertise; that’s why you can change it yourself.
  • Starting budget: an ad platform learns from the results that come in. In the long run, it needs at least one per day, preferably two. In the beginning, it can also be a few days with one per two days, as you scale up as soon as the first ones come in. Therefore, we calculate a daily budget based on half to twice what a result costs. About two-thirds of that goes towards the campaign for results and one-third to people you don’t know yet. The minimum is €30 per day on Google, Facebook and Instagram and €80 per day on LinkedIn; to start with, at most €150 per day. If even half of what a result costs is more than that, the platform first learns from a soft conversion, such as a download or a product in the shopping cart.
  • Growth phase: you increase the budget in steps of 10 to 20%, each time the results are stable for one to two weeks. Larger jumps can prompt the platform to start learning again. Learning takes two to four weeks (or longer if your customers take a long time to decide), with corrections taking one to six weeks.
  • Revenue: The gross profit from the first sale comes in as soon as someone becomes a customer; what a customer generates per year, we calculate monthly. The result after the media budget is the gross profit minus all advertising costs, including the portion for new people. A favorable and a cautious progression give the range.
  • Growth becomes more expensive (step 4): above your starting budget, a result becomes a fixed percentage more expensive each time your budget doubles. As a rule of thumb, we start at 3%.
  • Budgeting per month involves an average of 30.4 days. Amounts over €1,000 are rounded off to hundreds.

Google prefers at least 30 conversions in 30 days when offering automatic bidding: an average of one per day. You can scale up from there.

Calculation example based on your input, no forecast or promise. What ads actually cost and deliver depends on your market, your offering, and the execution. Management costs and other costs are not included.

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// Next step

Looking at your grades together?

Introductory call

30 minutes, free of charge

We will go through your calculation example together and see what a feasible starting point is.

Planning session

2 hours, €250 excluding VAT

We make your budget and growth path concrete: channel, campaign setup, and when you scale up. If you then start a workshop or course, we will reimburse the amount.

// Method

That's how we calculate

The tool calculates in four steps: what you need to get started, your path to your goal, what it brings, and what happens if growing becomes more expensive.

Break-even. What a maximum cost per application or purchase is to win back each new customer on the first sale: the gross profit on the first sale, multiplied by the proportion of applications that become customers. That’s where the price adjustment starts; if you advertise already, you’ll set it at what a result costs you now.

Starting budget. An advertising platform learns from the results that come in. In the long run, it needs at least one per day. Therefore, the tool calculates a daily budget based on half to twice the cost of a result, with a minimum per channel: €30 per day on Google, Facebook, and Instagram, €80 on LinkedIn. If a result costs so much that even a small start-up is too expensive, the platform first learns from a soft conversion: a small action that occurs more often, such as a download or a product in the shopping cart.

Growth stage. After two to four weeks of learning and a period of adjustment, increase the budget in increments of 10 to 20%, each time after one to two stable weeks. Larger jumps can cause the platform to learn again.

What it brings. The tool calculates the growth path day by day: advertising costs are immediately deducted, the gross profit from new customers comes in with the first sale and, if customers continue to buy later, every month in the years to come. A favorable and a cautious progression give the bandwidth and the moment when you reach break-even.

Growth is becoming more expensive. First, you reach out to people who are already searching or quickly deciding; then the platform has to do more searching. Above your starting budget, the tool calculates a percentage that makes the result more expensive with each doubling of your budget. As a rule of thumb, we start at 3%; you choose it yourself.

Only media budget counts: what you pay to the advertising platforms. Management costs and other costs not included. It’s a calculation example with your own input, not a forecast.

// Questions

Frequently asked questions

An advertising platform first has to learn who is responding. During that period, results fluctuate and a result is often more expensive. If you start big right away, you pay for that learning phase with a much larger budget. Therefore, start small and scale up once the results are stable.

A small action that people do more often before submitting an application or making a purchase. In lead generation, for example, downloading a whitepaper, viewing your pricing page, or signing up for a webinar. Adding a product to the shopping cart in a webshop or starting the checkout process. A request or purchase costs so much that the platform doesn’t get enough of it to learn from, then you first send it on to a soft conversion. That requires less budget.

First, you reach out to people who are already searching or quickly deciding. If you want to reach more people, the platform needs to do more research: people who know you less well or need more persuasion. How hard that is varies by market; that’s why you choose a percentage yourself in step 4.

Shows on LinkedIn are more expensive than on Google, Facebook or Instagram. Therefore, the minimum daily budget is higher there.

No. The tool only calculates media budget: what you pay to the advertising platforms. Management costs and other expenses are not included.

Sources

  • AceDigital proprietary data. Calculation formulas for start-up budget, growth path, and saturation from our own campaign practice