Method 1 — Percentage of revenue
| Business stage | % of revenue | Strategic intent |
|---|---|---|
| Startup / launch | 15–25% | Aggressive — build initial awareness |
| Growth (1–3 years) | 10–15% | Scale what already works |
| Established | 5–10% | Defend market share, stay top of mind |
| Mature market leader | 3–6% | Brand maintenance and innovation |
Method 2 — Objective-based (CPL × leads needed)
Required revenue ÷ average order value = customers needed ÷ close rate = leads needed × CPL = monthly budget.
- Example: Rs 5M revenue ÷ Rs 25,000 AOV = 200 customers
- 200 customers ÷ 20% close rate = 1,000 leads needed
- 1,000 leads × Rs 350 CPL = Rs 350,000 monthly ad budget
Recommended channel allocation by goal
| Primary goal | Digital | Traditional | BTL / Events |
|---|---|---|---|
| Online sales or leads | 75% | 10% | 15% |
| Local brick-and-mortar footfall | 45% | 30% | 25% |
| National brand awareness | 35% | 45% | 20% |
| B2B services | 60% | 30% | 10% |
Always reserve a test budget
- 70% on proven channels (with monthly performance reviews)
- 20% on testing new creative or audience segments
- 10% on entirely new channels and experiments
If you cannot measure CPL or CAC for each channel, you do not have an advertising budget — you have an expense.