Calculators
Marketing Budget Calculator
Most marketing budget advice is a percentage of revenue, which tells you nothing useful. A roofer with a $14,000 average job and a plumber with a $400 average job should not spend the same share of revenue. This calculator works from your actual unit economics — what a customer is worth, how often you close, and how much you want to grow — and tells you what you can afford to spend.
Free, no email required. The formula is published below so you can check the maths.
How does this work?
Rather than a percentage of revenue, it works backwards from what a customer is actually worth to you.
The chain: average job value × how many times they return = lifetime value. Multiply by gross margin to get gross profit. You can afford to spend a share of that gross profit — we use 20% as a target and 30% as a ceiling — to acquire the customer. Divide by your close rate to get what you can pay per lead, which is the number that actually governs your ad bidding.
Then: how much new revenue do you want, divided by lifetime value, tells you how many customers you need. Multiply by target acquisition cost, and that's your budget.
Worked example. A plumbing company with a $650 average job, 40% margin, customers returning about twice, and a 55% close rate on inbound calls:
| Lifetime value | $650 × 2 = $1,300 |
| Gross profit | $1,300 × 40% = $520 |
| Target cost per customer | $520 × 20% = $104 |
| Target cost per lead | $104 × 55% = $57 |
So a lead costing $50 is profitable and one costing $120 isn't — which is a far more useful answer than "spend 7% of revenue."
How to read your result
| Your monthly budget | What it means |
|---|---|
| Under $1,000 | Below the working minimum for any paid channel. Do the free work first — Google Business Profile and reviews |
| $1,000–$2,500 | Enough for one paid channel, run yourself. Follow the DIY playbook |
| $2,500–$6,000 | One or two channels. An agency retainer becomes viable around here |
| $6,000+ | Multi-channel, and worth someone managing properly |
What this doesn't account for
Worth knowing before you act on the number.
- Capacity. If you can't service more work, the right budget is zero regardless of what this says
- Seasonality. HVAC and roofing shouldn't spend evenly across twelve months. Take the annual figure and weight it to your demand curve
- Ramp time. SEO and content take months to produce. The first 90 days of any programme cost more per lead than the steady state
- Referral volume. If most of your work is referred, your paid channels are supplementing a smaller gap than the model assumes
- Existing customers. The cheapest revenue available is usually people you've already served, and no acquisition model captures that
Where the assumptions come from
The 20% target and 30% ceiling on gross profit are conventional planning figures for service businesses with a defined lifetime value — conservative enough to stay profitable through a bad quarter, aggressive enough to actually grow.
The tier bands come from observed channel minimums: Local Service Ads and Meta need about $1,000 a month to work, Google Ads about $1,500, and below those a channel can't gather enough data to optimise. See the paid media guide for the detail.
Frequently asked questions
What percentage of revenue should I spend on marketing?
It's the wrong question. A business with a $14,000 average job and one with a $400 average job need completely different percentages. Work from lifetime value, margin and close rate instead — that's what this calculator does.
Should my budget include agency fees or just ad spend?
Both. The number here is all-in. The suggested split shows roughly how much goes to media versus management, and below about $2,500 a month it assumes you're running it yourself.
What if I don't know my close rate?
Estimate it, then go and measure it. It's the single most useful number in this calculation and most businesses are surprised by the real figure once they track it.
What's a good cost per lead?
There isn't a universal answer — it depends entirely on job value and close rate. That's what the target cost per lead output gives you: your number, not an industry average.
My budget came out higher than I expected. Now what?
That usually means either your growth target is ambitious or your lifetime value is higher than you'd assumed. Both are fine. Start with one channel at the minimum viable spend and scale as it proves out.
Does this work for law firms?
Yes, using average case value and consultation-to-signed rate. Legal economics are extreme in both directions — expensive clicks, high case values — which is exactly why working from your own numbers matters more there than anywhere.
Want us to run the numbers with you?
The Growth Roadmap does this properly — with your real data, your market's actual search volume, and a channel plan attached. $2,500, credited toward your first 90 days.
Schedule a consultation · (615) 669-0707
Written by Jared DeValk, founder of Nashville Digital. Last reviewed September 2026.