How Much Should I Spend? How Do I Determine My Budget?

How Much Should I Spend? How Do I Determine My Budget?


Determining the right amount to spend on PPC per month depends on a few very important factors:

  1. How much will it cost you per click on average?
  2. What is your conversion rate?
  3. How many conversions do you need in order to produce a positive ROI per month?
  4. Last but not least – probably the most important – what can you afford per month?

PPC can be a very lucrative medium for growing your business but only if you can afford it. Like all marketing tactics, PPC requires testing. If you are already utilizing PPC as part of your marketing strategy, then you will be able to answer questions 1 and 2 above. If this is case for you, go ahead and skip down to the next section of this blog post. If not, continue to read the rest of this section before proceeding to the next one.

I have taken extremely small budgets (a few hundred dollars) and produced leads for clients. How did I do it? 9 out of 10 clients that I have worked with do not know of or understand The Consumer Funnel. And to be fair, why should they? After all, they are the mastermind of their business (product or service) not a marketing expert. Because business owners are experts in their products or services, understanding The Consumer Funnel will make them feel like this:

If you want to feel like a T-Rex with arm extenders and answer the questions above without it costing you a lot of money upfront, I offer a Free eBook that will give you an intro into The Consumer Funnel. The eBook walks you through The Consumer Funnel and will show you how to create Peronas (fictional customer profiles) so that you will be able to:

  • Narrow down your audience
  • Understand the purchasing process that is specific to your product or service
  • Set up your campaigns
  • And most importantly save money during your testing phase

This will allow you to really stretch your budget so that you can get all of the pertinent information that you will need for the next section of this blog post – and ultimately figure out how much your budget should be for PPC.



Depending on what part of The Consumer Funnel you are targeting, this will determine the PPC platform that is best suited for your goals. Each platform will have it’s own budget based on a postie ROI. For example, let’s use my passion project Aquapparel.

Aquapparel is a ocean conservation company that I created so that I could help raise awareness and take action to help save marine life and improve our environment. Here is a high level of Aquapparel’s Consumer Funnel:

Top Funnel

  • Raise awareness about conservation issues and their solutions by using YouTube and Facebook.

Mid Funnel

  • Bring people who are interested in learning more to Aquapparel’s blog through Facebook.

Bottom Funnel

  • Have the people who are interested take action themselves, purchase and wear Aquapparel gear. If they do not want to do either of those things but they want to help fund our conservation projects, then they can make a donation. I do this by retargeting people who have read my blog posts coming from my Facebook ads that promote them.

Using an Excel Spreadsheet, I use this equation to determine how much I should spend for the following month using the answers to the questions in the first section of this blog post:

Here are the equations that I use by cell:

  • Cell B4 = B1/B2
  • Cell B5 = B4*B3
  • Cell B7 = B5*B6
  • Cell B8 = B7-B1

Now to answer question number 3 from the first part of this blog post: How many conversions do you need in order to produce a positive ROI per month?If your ROI number in the above equation comes out as a negative then you will need to increase your Conversion Rate.

There are a number of ways to do this depending on the platform that you are advertising on. In the next blog post of this series, I will help you determine which PPC Platform is best for your campaign.