This is a million dollar question (pardon the pun). All my clients ask me: “How much should I spend on Facebook advertising?”

Before I can even answer, that question is then quickly followed by, “What results can I expect for that money?”

These are incredibly important questions to answer, but you can’t start there. So I decided that for today, I’m going to help you guys walk through the process of figuring out exactly how much you should spend on your Facebook (or any digital) ads.

Step 1: What are you selling and what is its value?

How much money do you make when you make a sale? For me, it varies. As you know, I’m running my Facebook course, and it costs $250 per person. But I also have an elite coaching program that costs $10,000 per person, and then I have a bunch of services in between. My profit margins also vary, so take those into account as well.

Step 2: How many sales do you need to pay back your marketing costs?

Steps 2 and 3 are a bit of “chicken and the egg”, so pick which one you want to start with and run with it. You’ll get the same result. I normally do a bunch of scenarios so I can test a few ideas and spend levels.

If I’m going to spend $2,000 on my $250/person course, I need 8 people to break even. Anything on top of that is gravy. How likely is it for me to get 8 people on an ad spend of $2,000 – and then more in order to actually make a profit?

This is simple math, but very important math. If you’re only making a $50 profit off of each client that you get through your advertising, and you’re going to spend $1,000 to get new clients into that program or to purchase that product, you’ll need to get 20 new clients just to break even. How likely are you to be able to achieve that?

A simple product can fly off the (digital) shelves, but a more complicated one might take longer to close. Your sales cycles and timelines are also important to keep in mind.

So Step 2 is really about setting your goals of how many clients/sales you want to get from your marketing efforts. Then you go to Step 3!

Step 3: Set your budget

This is your grand leap of faith. I participate in a lot of high-ticket-sales groups on Facebook, and there are millionaires who talk about the feeling of investing a LOT of money in Facebook ads, and how their hearts are in their throats because it just feels like it’s so MUCH!

There’s a coach in the US who spends $25,000 per month on advertising. BUT, he generates $100,000 per month so it’s worth it. But he wouldn’t get the $100,000 if he didn’t advertise at $25,000.

So you see, you need to spend money to make money.

Whenever I’m setting my ad budgets, I go through these three simple steps, and when I get to the last one, I push my ad budget just beyond my comfort zone. Did I want to spend $2,000 for my Facebook course? No! But I wouldn’t have it already mostly full if I hadn’t, would I?

To ensure you get the best results from your ads, you have to ensure you do them properly. If no one likes your ad, no one gets into your sales funnel, and you’re dead in the water. That sucks!

So, as a shameless plug, if you want to know how to get the Facebook ad part right, and set up your funnel for success, sign up for my course. It opens Monday March 7th, but I’ll be running it every 2 months.

Click here to register!

And now go out there and sell, sell, sell!

Rebecca