One of the most common questions we get from clients is: “How much should we spend on online advertising?” But there’s no one-size-fits-all answer. The size of your budget depends on several factors – from your goals to the competition in your industry.
In this article, we’ll show you how to think about your budget strategically and what you definitely shouldn’t overlook when planning it.
Why have a clearly defined budget?
- You avoid overpaying for ineffective campaigns
- You can evaluate your return on investment (ROI) better
- You know how much you can get back in different scenarios
- You gain control and a clear overview of your spending over time
3 basic questions you need to ask yourself
1. What’s your goal?
- Getting new contacts (leads)?
- Increasing sales in your online store?
- Building brand awareness?
➡️ Each goal calls for a different approach and budget.
2. Who are your competitors and what are the prices in your industry?
- In insurance, for example, a click can cost €3–5
- For a smaller local service, it might be €0.30–0.80
➡️ Check out your competitors with tools like Google Keyword Planner, SEMrush or Ahrefs
3. What’s the value of a single conversion?
- If one client brings in €500, it’s worth investing even €50–100 to win them.
➡️ Track your CAC (customer acquisition cost) and LTV (lifetime value)
The recommended approach to budget planning
A test budget to start with (the first 30 days)
– Recommended minimum of €300–500 for smaller campaigns
– Goal: test keywords, creatives and audiences
Scaling after optimization
– If the campaign delivers ROI, gradually increase the budget
– Check performance regularly – cost per conversion, click-through rate (CTR), conversion rate
How should you split your budget?
It depends on your goals, but a split like this often works:
- 60% Google Ads (search, remarketing)
- 30% Meta Ads (Facebook, Instagram)
- 10% testing other channels (YouTube, TikTok, LinkedIn)
For a B2B business it may look different than for an online store – your budget should be based on data, not gut feeling.
What not to do
- Don’t start without a strategy – spending money at random is the most common mistake
- Don’t judge campaigns by hunches – judge them by data
- Don’t jump between platforms right away – it’s better to start with one and test
Your online ad budget shouldn’t just be about “how much you have available.” It should come from a strategic decision that takes into account your goals, customer value and the state of the market. A properly set budget isn’t an expense, it’s an investment that can pay you back many times over.
