Google Ads Budget Calculator for Ecommerce
Most Google Ads budget advice boils down to "it depends." We built something better.
At DNM Digital, we use the same formula for every ecommerce client we work with to determine their ideal Google Ads budget. We've turned that formula into a free calculator you can use right now. No sign-up, no email gate. Just enter your numbers and get your answer.
If you sell multiple products, use your weighted average margin.
Be specific. "As much as possible" leads to overspending without a profitability floor.
Your break-even ROAS is 2.22x. Target above this to be profitable.
How many times does the average customer buy over 12 months?
| Gross Margin | Break-Even ROAS | Safe Target (×1.5) |
|---|---|---|
| 70% | 1.43x | 2.14x |
| 60% | 1.67x | 2.50x |
| 50% | 2.00x | 3.00x |
| 45% | 2.22x | 3.33x |
| 40% | 2.50x | 3.75x |
| 30% | 3.33x | 5.00x |
| 20% | 5.00x | 7.50x |
Your Results
Fill in your numbers on the left.
Results update instantly.
Want us to run this on your real account data?
We’ll analyse your historical ROAS, actual CPA by channel, and customer LTV to build a budget plan tailored to your business.
Calculate Your Budget in 4 Steps
The calculator needs four inputs from you. Each one is a number you either already know or can find in your ecommerce platform in about 30 seconds. Here’s what they mean and why they matter.
Your gross profit margin determines how much you can afford to spend on ads.
Formula:
(Selling price – COGS) ÷ selling price × 100
COGS includes product cost, packaging, and shipping to the customer (not overheads).
Example: $100 product with $40 cost = 60% margin.
Why it matters
Your margin sets your break-even ROAS.
| Gross Margin | Break-Even ROAS |
|---|---|
| 70% | 1.43x |
| 60% | 1.67x |
| 50% | 2.00x |
| 40% | 2.50x |
| 30% | 3.33x |
| 20% | 5.00x |
Lower margin = higher ROAS required to stay profitable.
AOV determines how many sales you need to hit your revenue target.
Formula:
Total revenue ÷ total orders (use 90 days)
Why it matters
Higher AOV means fewer orders, fewer clicks, and lower required budget.
Example:
- $40 AOV = 2,500 orders to reach $100K
- $150 AOV = 667 orders
This is why budgets vary so widely between ecommerce stores with the same revenue goal.
This is the revenue you want Google Ads to generate each month.
Be specific. “As much as possible” is not a usable target.
If you’re new to ads, start with 15–20% of total monthly revenue while you gather data. Early performance is about learning as much as scaling.
ROAS = return on ad spend.
Options:
Auto (recommended)
Break-even ROAS × 1.5
A balanced, profitable starting point.
Custom
Use your existing performance data, but always stay above break-even ROAS.
LTV-adjusted
For repeat purchase businesses. If customers buy more than once, you can afford a lower first-order ROAS based on lifetime value.
Your Results: How to Read Them
Once you’ve entered all four inputs, the calculator generates five outputs instantly. Here’s what each one means.
Formula: revenue target / target ROAS = budget
This is your maximum monthly ad spend. It’s the ceiling, not the starting point. We always recommend starting at 60-70% of this number and scaling up over 60 to 90 days as your ROAS stabilises. The calculator shows this starting range below the main budget figure.
Formula: budget / (revenue target / AOV) = target CPA
This is the maximum you should pay per order to stay profitable at your target ROAS. It’s useful as a bidding benchmark and a performance check. If your actual CPA is consistently above this number, something needs to change: your ads, your landing pages, your targeting, or your budget expectations.
This is the metric most ecommerce businesses overlook, and it’s one we track religiously at DNM Digital.
NCAC isolates what it costs to win a customer who has never bought from you before. It’s always higher than your blended CPA because new customers cost more to acquire than returning ones.
The calculator estimates your NCAC at 2.5x your target CPA. This is a midpoint. In practice, NCAC ranges from 2x to 4x depending on your industry and brand recognition.
Why it matters: if you’re in growth mode and prioritising new customer acquisition, your budget needs to account for NCAC, not blended CPA. That means your actual required budget may be 30-50% higher than the main number suggests.
Formula: revenue – COGS – ad spend = contribution margin
This is the bottom line. Revenue minus product costs minus ad spend. If this number is positive, your ads are generating real profit. If it’s negative, every sale through ads is losing you money, even if your ROAS “looks good” on paper.
The calculator colour-codes this for you: green means profitable, red means you’re losing money at that budget level.
Ready to hit the mark?
Let’s get started!
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