Tool
Ad unit economics calculator
How many leads you need, what they should cost, and what budget it takes for ads to be profitable. The classic model: work backward from your sales goal to the click.
Your targets
Monthly funnel
Budget and outcome
How it’s calculated
Profit per sale = average order value × margin. This is the most you can spend per customer and still break even.
Target cost per customer (CAC) = profit per sale × the share you’re willing to put toward ads.
Leads needed = sales ÷ qualified lead close rate ÷ qualified lead rate.
Maximum cost per lead (CPL) = CAC × qualified lead rate × close rate. If leads cost more than this, ads are eating into your profit.
Budget based on traffic = leads needed ÷ website conversion rate × CPC. This is what you’d actually spend at your current click cost and conversion rate.
ROMI = (profit from sales − budget) ÷ budget. ROAS = revenue ÷ budget.
Why qualified leads are what matter
If half your leads are random people, your real cost per lead is double what Ads Manager shows. That’s why the calculator breaks out cost per lead and cost per qualified lead — the kind that can actually turn into a sale.
What the model doesn’t include
- Repeat purchases and LTV — factoring them in raises your target customer cost.
- Your fixed overhead and agency fees.
- Sales cycle length — revenue can come in months after you pay for the ads.
Use it as a decision-making guide, not a financial model.
Want to run the numbers on your real data?
I’ll walk through your numbers in a free audit.