How much do ads cost?

There is no set price. You choose what you spend a day, and the ad auction decides what each click or sale costs you. The number that actually decides whether ads work for you is what one customer is worth - not the budget.

What you are really paying for

You are not buying an ad. You are buying a customer. So the only question that matters is what you pay to get one, and whether that is less than the customer is worth to you.

The sum that decides it

Work out what one customer is worth before you look at a single budget:

What they spend the first time × how many times they come back
Example: a salon client spends $60 and comes back six times a year, so she is worth $360
That number is the most you can afford to pay to find one

What a sale is costing you right now

Money spent divided by sales. If you spent $2,400 and made 12 sales, a sale cost you $200. Compare that with what a customer is worth and you have your answer: keep it, cut it, or put more behind it.

So what do I set the budget to?

Enough to buy a decision, not a feeling. Set a daily amount you would not miss, leave it alone for about a week, and judge it on what a sale cost you - not on how many likes the ad got.

When the cost is too high

If a sale costs more than a customer is worth, no budget fixes it. That is an offer problem, not an ad problem: what the ad is selling asks too much of a stranger who met you three seconds ago.

Where the whole thing is taught

Ads That Pay For Themselves is the step by step: the offer, the three ads, the numbers, and what to do when one of them stops working.

See what is inside