How Much Should You Spend on Facebook Ads? The Real Formula Behind Profitable Ad Campaigns

1. Your Program Price Changes Everything

Your program price directly impacts your conversion rates and budget requirements. Here's what most people don't realize: lower-priced programs typically see higher conversion rates because more people in your audience are "ready, willing, and able" to buy.

For example, if you're selling a $750 program, you might see conversion rates around 2-2.5%. But scale that up to a $5,000 high-ticket program, and your conversion rate might drop to 1.5-2%. That 0.5% difference can dramatically impact how much you need to spend to hit your revenue goals.

2. Cost Per Lead: Your Make-or-Break Number

This is where the magic happens. With a $750 offer, and getting a cost per lead of $4.59. Here's how the math works out:

• Ad spend: $2,500

• Leads generated: 545

• Conversion rate: 2%

• New clients: 11 people

• Revenue potential: $8,250

• Return on ad spend potential: 3.3x

For every dollar put into ads, this gives $3.30 back. That's like having a slot machine that pays out consistently, day after day. If any of these numbers come back lower, you know EXACTLY where to focus. Getting leads at the right cost but not seeing conversions? There is a sales problem, and it needs attention. The math works when you work it! 

But here's the kicker—if you can get your cost per lead under $5, you're in the sweet spot for serious scaling potential. This is especially true for health and wellness niches, where costs under $5 per lead are absolutely achievable.

3. The Scaling Trap Most People Fall Into

Here's what happens when you try to scale: Facebook's algorithm works on a "lowest bid strategy," meaning they'll capture the easiest, cheapest leads first. Once you've exhausted that pool (usually after 500-1,000 leads), your cost per lead starts creeping up.

This is why I recommend having 6-12 tested audiences that consistently perform. When one audience gets expensive, you can rotate to fresh audiences with new messaging angles, bringing your costs back down.

Real Numbers: Planning Your Next Launch

Let's say you want 50 people to join your $5,000 program.

With a 1.5% conversion rate and a $6.50 cost per lead, you'd need:

• Total leads needed: 3,333

• Ad spend required: $21,667

• Expected revenue: $250,000

• Profit: $228,333

That's a 10.5x return on your ad investment. Even if your conversion rate drops to 1%, you're still looking at a 7x return.

The Reality Check: Volume Matters

Here's the brutal truth—if your cost per lead is $25 and you're selling a $5,000 program, the math doesn't work with low volume. Even with a $2,000 ad spend, you'd only get 80 people on your list. With a 1% conversion rate, that's maybe one sale. You’d need a lot more than 80 cold people in order to see your high-ticket offer truly shine. 

You need volume to make the numbers work. This is why getting your cost per lead down is so critical. Under $10 per lead is where you start seeing real movement, even with modest conversion rates.

Focus on Dollar Value, Not Just ROAS

Here's a mindset shift that will change everything: stop obsessing over ROAS percentages and start looking at actual dollar values.

Would you rather have a 10x ROAS where you made $2,000, or a 4x ROAS where you made $100,000?

The answer is obvious, but too many marketers get caught up in vanity metrics instead of focusing on what really matters—profit in your bank account.