Daily Online Ad Budget

Confused by what to make your daily online ad budget? A lot of clients ask me how much should they spend daily on ads. The truth is, it can be complicated and one approach does not work for all businesses.

Whether it is on Google, Etsy, Amazon or social media, one simple way to look at it, is to analyze your ad impressions, ad clicks and the sales that result.

If you take the basic conversion rate rule of 1%, this means 10,000 ad impressions → 100 clicks → 1 sale (worse case scenario).

Breaking Your Daily Online Ad Budget Down

For example, let’s say your sales conversion rate is 2% (orders/clicks). Then 50 clicks → 1 sale.

If you are not getting enough ad impressions to get at least 50 clicks, then it is unlikely that you will get that one sale, and the money spent that day will be for not.

So, your ad budget needs to be high enough to get at least 50 clicks.

If a click on average is costing you .20 cents, this means you need to spend at least $10 day to get the 50 clicks (50 x .20 cents = $10) to result in the 1 sale.

Now, if you are not getting enough ad impressions to get the required clicks, the cause might not just be budget, but also the range and variety of keywords you are choosing.

Therefore, using this as a baseline will help you decide what to budget, as well as if the ads are even effective for you. But sometimes spending too little, is just a waste of money.

If you sell on Etsy, Amazon or your own website, book a Phone Consultation with me and we can review your ad strategy and make sure your daily online ad budget is working for you. Also, visit my online store for downloads and planners.