How much should a small business spend on ads?
In this article 4 parts
Start from the customer
Two questions:
- What's one new customer worth to you? In profit, not just the bill.
- How many leads does it usually take to get one customer?
That tells you the most you can pay for a lead and still make money.
A quick example
Say a customer is worth ₹20,000 in profit and one in five leads becomes a customer. You can pay up to ₹4,000 per lead and break even. If ads bring leads at ₹800, you're winning. Spend more.
Example numbers only. Plug in yours.
How big should the test be?
Big enough to get 20 to 30 leads in the test period. Fewer and you're reading tea leaves.
Then scale slowly
Raise budgets in steps of around 20 percent and watch cost per lead. Doubling overnight is a great way to find out what "learning phase" means.
Quick questions
Is ₹10,000 a month enough for ads?
For a local business testing one offer, it can be a start. Competitive categories like real estate usually need more to get clear numbers.
Should I split my budget between Meta and Google?
Start with one, prove it, then add the other.
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