How Much to Spend on Google / Facebook / Instagram Ads

Find Optimal Budget for Google, Facebook, and Instagram Ads in 3 Steps

Step 1: Identify your Goals for Revenue or Leads

 

Set your revenue and leads goals and decide accordingly how much you are willing to spend to achieve those goals. For example, if it takes 50 new customers to meet your revenue goals set your marketing budget for acquiring 50 new customers.

Step 2: How Much is Worth Spending Per Click?

 

After goals, estimate the average cost per click that you’re willing to spend without plummeting the profit margin. Put simply, choose your target keywords wisely. If $5 is the average CPC, then a budget of $1,500 would buy you 300 visits.

Step 3: Lead-To-Customer Conversion Rate

 

Now the determining factor is if you’re able to effectively convert your leads into customers. That would determine whether your campaign is a success or not. In other words, ensure a higher conversion rate for your campaigns.

 

Also read: How to Appear on the Top of Google: Tips to Appear on the First Page

How Much Should I Be Spending On Google Ads?

 

Before answering this, consider these two points:

• Revenue per new customer

• Profit per new customer

In simple terms, ask yourself, “how much revenue do I expect to generate from a customer who visits my website after clicking my ad.” And “what profit would that one new customer bring to my business?”

Average Marketing Budget for a Small Business

 

When it comes to the average marketing budget for a small business, it’s around $2,500 – $7,500 a month.

 

However, what can influence your average ad spend is the cost-per-click and competition. If the competition is high, costs per click go up accordingly.

 

This is how you can set your budget for Google Ads.

 

Decide how many new customers you want to acquire. Suppose you want to grow to 20 new customers with a conversion rate of 10%. To meet your target of getting 20 customers, 200 visitors need to visit your website. If the CPC is $5 per click/visit, that amounts to a $1,000 marketing budget for this campaign.

How Much Should I Spend on Facebook Ads?

 

Setting the optimal budget is something you can’t decide without doing it. First, you have to make an investment and measure results. 

 

Then decide was this a good investment or not in terms of return on investment or ROI. Tweak your campaign accordingly to find the perfect Facebook Ads budget for your business.

Run a Test Campaign on Facebook

 

Set a $20 budget per day or spend around $1000 in total. At the end of the week, measure your results. See if the campaign was cost-efficient or not.

 

Here also you need to take care of the following things.

 

• Know your audience(s). If you’re targeting a much large and more diverse audience, consider breaking it down into smaller groups.
• Target each group with a separate ad set. Tailor your campaign in such a way that each ad set has unique graphics, calls-to-action (CTA), and copy, each aligning with the interests and target keywords for a specific group of audience.
• Measure the performance of each ad set and gather relevant information as to what made one ad set perform better compared to other ad sets. That would give you an idea of what audience to target and what visuals, keywords, and CTA to use.

Short-Tail vs Long-Tail Keywords: Which Ones To target?

 

You’ve got your audience right. Now you can easily set your Facebook ads budget based on what works better for you. However, make sure that you’re targeting the right keywords. 

 

Generally speaking, short keywords are more expensive and broad. A disadvantage with them is that they attract irrelevant traffic to your website, besides being costly. If you want to attract potential customers that are valuable to your business, target long-tail keywords.

 

Long-tail keywords cost less and can reduce your Facebook ad budget significantly. And have low competition as such key terms are targetted by fewer people, hence can prove to be a great investment for your business.

 

Also read: Competitor Keyword Analysis: How to Identify Competitor Keywords

Average Budget for Facebook Ads Per Month

 

Now that you have the keywords, it’s now easier to set your budget for Facebook ads. Check your keywords one by one in tools such as Semrush or Ubersuggest to figure out their cost-per-click (CPC). 

 

The estimated CPC per keyword will determine your overall marketing budget. Of course, you can increase or decrease the same according to how much you can afford. On average, a business usually spends $300 or $1000 to advertise on Facebook ads per month. 

 

Also read: How to Create Social Media Marketing Strategy for your Business

How Much Should I Spend on Instagram Ads?

 

If you’re just starting out with Instagram Ads and have no data available to guide you through, this is how much you should spend, to begin with. Of course, if you can spend more, do it.

 

On average, a business spends around $1000 a month on Instagram ads. But remember, this is just to test the waters. In other words, testing whether they can get desired results with this ad budget.

 

Once you get some preliminary results to inform your future campaigns, you can optimize your ads to lower your costs per campaign. This you can do by targeting keywords that have lower CPC but deliver higher value in terms of ROI. However, you need to keep in mind that on Instagram average CPC ranges between $0.50 to $3.50 for normal or low-budget keywords. 

Are Instagram Ads Worth it?

 

Yes, any investment made on Instagram ads is worth it! What you will get in return is more traffic to your website and sales. In fact, a well-optimized ad campaign on Instagram can drive a great return on your investment.

Key Takeaways

 

A key to optimal budgeting for any platform, whether Google, Facebook or Instagram is identifying your goals and the amount you’re willing to spend to meet those goals. To lower your cost per campaign, you can optimize for long-tail keywords with lower CPC. 

 

Once you have the data, you can further customize and optimize your campaigns. And set the budget according to your needs. That’s to say, it depends on how many new customers you want to acquire and how much revenue you want to generate. This will give you an idea of how much budget would be required to meet those goals. 

Need help with social media marketing? Vistoplex Media can help get started with Google, Facebook, and Instagram Ads. Want to learn how? Ask for a quick consultation call at hello@vistoplexmedia.co.uk. Get in touch today or fill out our contact us form.