01Ad spend floorCalculator · runs in your browser
Big enough to learn from?
Is my ad budget big enough to learn from? Type four numbers and the floor comes back in dollars a week and a month: the least you can spend and still judge a creative.
Fill the four boxes. The floor appears here.
02The workingPlain English
How it is worked out.
- Your margin sets the break-even return. Divide one by the gross margin and that is how many dollars must come back for every dollar spent before the ads stop costing you money.
- The most you can pay to win one order without losing on it is the order value times the margin. Call that the allowable cost per order. Above it, every sale is bought with your own money.
- A creative needs a set number of results in a week before the platform, or you, can judge it. That is the assumption in the last box, and it is yours to change. At the allowable cost per order, that many results is the weekly floor.
- The monthly floor is the weekly floor times the weeks in a month. Testing two creatives at once doubles it; the floor is per creative.
- Your target orders a week times the allowable cost per order is the budget your target implies. If it sits under the floor you are not buying enough results to learn from, and every read is noise. Raise it to the floor, or test one creative at a time and give it the weeks it needs.
The floor is about learning, not profit. Clearing it means a creative can be judged inside a week; it does not mean the creative is good. Once you have the read, the next article is the one that tells you what to do with it.
No deck. No discovery theatre. One metric, one date, in the contract.