How to Set a PPC Budget That Actually Makes Sense
A practical, math-driven framework for setting and defending a paid media budget — without guessing.
Strategy · Published 2026-02-18 · By Terryl Wilder
"How much should I spend on Google Ads?" is the most common question we get — and almost always the wrong question to ask first.
Start with the math, not the budget
Before you set a budget, you need three numbers: your average customer lifetime value, your gross margin, and the maximum you can afford to pay to acquire one customer (your target CPA).
The simple formula
Target CPA × Expected monthly conversions = Required monthly budget. That's it. Everything else is keyword research and forecasting.
If your math says you can spend $200 to acquire a customer profitably, and you want 50 new customers a month, your budget is $10,000 — period.
How to build up to that budget
Start at 25% of target. Validate conversion economics. Scale to 50%, then 100%, then beyond. Most accounts fail because they scale spend before they validate the math.
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