FREE Paid Ads ROAS Calculator (Steal This!)

In this video, I'm going to answer one of the most common questions in digital marketing. What should my budget be for running ads and can I afford it? We'll use a simple calculator to help you determine how much you should spend on running ads to get the best results. So let me show you how it works. Here's how the calculator works. Over here are where you're going to be entering your data. Okay, the left hand side is ad spend budget. This is the first number that you're going to be entering. What is the budget that you have allocated for your ads over 90 days? So we have $15,000 here for this example. That means about $5,000 per month being spent on ads over 90 days. You can obviously put more, for example 25,000 or for example 50,000. And the numbers will change once you do that. The number of leads will go up, the number of calls will go up, the number of calls that actually show up will go up and then you can change that there. Okay? So these two numbers will manipulate everything else. Do not touch anything else over here. Okay? This is all simply for the calculation. All you're going to do is input your offer price and your ad spend budget over 90 days. Okay? So if you have a budget of $15,000 over 90 days, that's $5,000 per month. If you have an offer for, you know, $4,800, right. You would put that right here and then the rest would change for you as well. Okay, I'm going to put this back to $5,000. Now the next thing in the budget calculator that I want to explain is the best case, average and worst case scenario. Okay? Best case, average case, worst case scenario. So don't touch any of these numbers here, all right? They're already formulated for you, but I want to give you the KPIs. You can see what the best case, average and worst case be across the board in this industry. Right? Selling high ticket coaching courses, services, MasterMinds, A agencies, etc. The cost per lead will range from $20 to $50 in today's marketplace. Okay, $20 to $50, right. Your cost per booked call is going to be around 200 to $400. Now if you're doing B2B, okay, so for example, we're selling to coaches, course creators, agency owners. This can be as high as 400 to $500 plus depending on your audience. Especially when it's a marketing qualified lead. Someone that actually not only books a call with you, but is actually Qualified, meaning they make enough money to actually work with you. That can be a lot higher, right? So you want to be aware of that. Right? So you have real realistic expectations here. And then show up rate is anywhere from 60 to 80%. In B2B, it could be, you know, 60 to 80, but B2C can be as low as 50, sometimes even 40. Okay, that's like worst case scenario. So this is a range obviously of what you want to aim for. Okay? Now close rate across the board in the industry, KPI should be 15 to about 40%. 15 is like worst case scenario. You know, out of like 10 people you talk to, you're closing one, right? That's like. And they're qualified. It's like, you know, that's, that's worst case scenario. Best case, you're closing 4 out of 10, right? That's like really, really good. And you should increase your prices immediately because you're just, you have so much demand, right? So that's the industry KPIs. And so we've given you three case scenarios here. Best case, average case, worst case. So best case, you're getting cost per leads for $20. You're getting cost per book calls of $250. You're getting a show up rate of 70%. Like 7 out of 10 people are showing up when they book a call, right? And then you're closing three out of 10 people. That's best case. That's really, really good. Okay. And most people, right, take weeks or months to dial in to get it to this point. Okay, most people take weeks or months to dial it in to get it to this point. This is best case scenario. Now average, okay, average case is usually cost per lead of around $30, cost per book call of $300 or more. Your show up rate, about 60%. Which is industry standard, like across the board average, right? Close rate about 20%. You're closing 2 out of 10 people you talk to, all right, that actually show up to the call. That's average case. All right, so worst case, $40, cost per lead, $400, cost per call. 50, 50% show up rate. 5 out of 10 people are actually showing up to the calls that they book. And then 10% of people are being closed. That means you're closing one out of 10. That's worst case scenario. So here's what that looks like to be. If you have a budget of $15,000 over 90 days, which is $5,000 per month, and you're selling an offer of $5,000, that means best case, you can realistically expect about 750 leads, 60 booked calls, 42 showed calls, meaning live calls that you actually talk to people, 13 sales and $65,000 in revenue generated, which is a return on ad spend of 4.3x. That's really good. Really, really good. Okay, best case scenario, most businesses in today's marketplace really can't consistently keep above a 4x. And I've seen this many times because again, there's a, there's a lot of factors at play. It's not just the ads, it's not just the funnel. It's also the sales team, the sales process, the sales management, leadership. Right, It's a lot of those things as well. It's not just the ads. It's usually the leadership of the team, the management of the sales team, or even just leading yourself, managing yourself, managing your emotions, being able to close, being able to show up, high energy, being able to do all those things. It's a, it's a system. Right? So there's a lot of factors that can obviously affect this end result right here. But best case, given the math here, with a $15,000 budget, $5,000 per month, and an offer of about $5,000, best case, you can expect about a 4x return on ad spend. Best case, that's really good. Okay, average case, you can expect about 500 leads, about 50 booked calls, 30 calls that actually show up, 6 sales, and about $30,000 in revenue generated gets a 2 extra turn on ad spend. Meaning you spent $15,000 on ads and you made back $30,000. Still really good. Okay, a 2x return on ad spend is still really good. Why? Because you spent 15,000, you made $30,000 back, and that's about $15,000 in profit. Now if you deduct overheads and you know, things like that, maybe it's more like a 1.5, but you're still making about $10,000 in pure profit and you're acquiring customers at a profit that you can then upsell into back end offers like a mastermind or to an agency service that's more long term. And you can increase your LTV because you're actually profitable on the front end. So you can spend more and make more money on the back end. That's still really good. 2x is still really good. Most businesses would love a 2x, especially at the corporate level, because if they're profitable, making double their money back on their ad spend, spending 15, making $30,000 back, they're going to spend a f Ton of money simply because they can make a lot more money on the back end because they're acquiring customers at a profit. Now, worst case, you spend $15,000 over 90 days and you have a $5,000 offer, right? Worst case, you get only 375 leads. You get about only 38 booked calls. And out of those 38 calls, only 19 people show up, right? At a show up rate of only 15%. Your number of sales is only two, and that means you only make $10,000. So your return on ad spend is less than a 1x. It's a 0.67x return on ad spend. You've spent 15 grand, you've made back $10,000. Now keep in mind, even if you did this in the first month of running your ads, that's still pretty good. You spent 15 grand in the first month, let's say, right? Or I should say, you know, five grand in the first month, right? And, or just in General, let's say 90 days, you spent 15 grand, you made back $10,000. That's obviously not going to be best. But if this was month one, you spent 15 grand and you made back $10,000. Month one, right. That's still really good. Still really good because it means you have something to work from. It means you can now scientifically look at the data and make optimizations. Is it the landing page you need to be improved? Is it the cost per book call? Is it the actual sales process? You can start to work the system and actually move to the average case and then of course, the best case, right? So month one, if you got this, I'd be like, dude, this is awesome. Like, this is really, really good right now we can actually work the system, optimize the entire structure to make it better, right? So this gives you a general idea of what you should expect. Okay. Now this should also help you become aware of exactly how much you need to spend to be able to make the money that you want. Because as you can see here, if you're only spending $15,000 over 90 days, you can realistically expect to make 60, $65,000, which is still really good. But if you're expecting to make a hundred grand, well, obviously you're gonna have to change this number to $25,000. Then you can realistically expect to make a hundred grand, given that everything in your system's optimized enough to where you're getting 20 cost per leads, 250 cost per calls, a 70 show up rate and a 30 close rate, which is very, very, very hard to do, especially right out the gate, because especially if you're starting from scratch, meaning you're a total beginner, you don't really have a validated offer yet. You haven't really ran a book, a call funnel before using a vsl. You know, you don't really have your setters or closers, or maybe you haven't even, you know, trained yourself to take calls from people that don't know you, like you or trust you just yet. It's going to take time to optimize that system to be able to get to the best case scenario, which is why most businesses can't consistently hit a forex return on ad spend to cold traffic. So that's best case. That's why it's best case scenario, right? And if you're expecting to only spend, well, let's say $12,000 over 90 days and you sell a $4,800 offer, well, you can only expect to realistically get about, you know, average case, 400 leads, maybe 40 calls, maybe 24 showed calls, maybe five sales and make 24 grand. Still really good. But you got to have realistic expectations here given your actual budget. Obviously, the more you spend, the more data you acquire faster. The faster you acquire data, the faster you can make optimizations to improve the system. The, the more you improve the system, the closer you can get to an average case or best case scenario by optimizing your system, improving your landing page, improving your ads, improving your sales process, right? Improving your actual show rates, meaning your email marketing sequences, your nurturing sequences, your content to actually get people to where they're actually buying more from you more consistently. And a best case scenario, right? So the less you spend, the less data you acquire, the less fast you'll be at actually improving the system as a whole. So just keep that in mind because it's important that you have this video in the very beginning of this training so that way you understand exactly how this works and what you can expect realistically. So long story short, that's how this works. Hope this makes sense. If you have any questions, let us know. But just change these two things, right? Play with this a little bit and you will be able to calculate exactly what you can expect in terms of your roas, revenue generated, number of sales, number of calls. Now I will say this as well. If you already have a sales team, right, maybe you're running Facebook ads and you want to add YouTube ads as a second traffic source, right? Because you need to fill your sales team's Calendar with more qualified leads. Well, to reverse engineer this and you say, okay, I have a new closer being ramped up and they need a full calendar in the next 30 days. Well, you know that a full calendar is about three to four to five calls per day, right? Four to five calls per day, best case scenario. So if you look at this and you're only spending $12,000 over 90 days, right? That's about obviously $4,000 per month. Well, they're going to get basically if you look at this, right, 90 divided by 48, best case scenario, that's maybe one to two calls per day. Maybe that's not going to be enough to fill their calendar. Okay. If you are running ads for yourself and you're the full time salesperson, well, if you only have a budget of $12,000 and you can expect to get maybe one to two calls per day, best case. So if you need more calls, right, Especially showed calls because obviously some people that book a call won't actually show up and you're going to need to spend more budget. So $20,000 right now you actually have, okay, 56 showed calls over 90 days, right? And that's how you can actually reverse engineer the math to figure out how money, how much you need to spend realistically to pack your closers calendar or your calendar with showed calls that they can actually speak to you and eventually close in terms of sales. So hope that was helpful. I'll go ahead and change these numbers back for you here so that can be at the starting point. And play with this. Enter these numbers here with your budget over 90 days and obviously reverse engineer that per month and then your offer price here, put that in there and then obviously you can see what the realistic expectations would be. Best case, average case, worst case for you.