Spoiler: “Whatever’s left over” isn’t the right answer.
Let’s get one thing out of the way:
“We’ll just spend a little and see what happens” is not a strategy. It’s wishful thinking with a side of credit card roulette.
At Agency501, before we launch anything—before a single dollar hits Google, Facebook, or a billboard—we ask one thing:
What’s your ad-to-sales ratio?
What’s That?
Your ad-to-sales ratio is how much you’re willing to spend on advertising to generate a dollar in revenue.
Simple math. Wildly powerful. And somehow still skipped by most businesses.
For example:
- You want $1 million in revenue.
- You’re willing to spend 10% to get there.
- Boom. You have a real ad budget: $100,000.
Now we know what we’re working with—and how aggressive we can be with your media, content, and creative.
(Also, you’d be shocked how many people want $2M in new sales but budget like it’s a Facebook garage sale.)
Why It Matters
When you don’t start with an ad-to-sales ratio, your marketing becomes a random expense instead of a planned investment.
And when your ad budget is “whatever’s left after payroll, beer, and that one software you forgot to cancel,” your results will reflect it.
We’re not saying you need to go full Super Bowl commercial. But we are saying:
If you don’t know your numbers, you’re flying blind.
So… How Much Should You Spend?
It depends. Some industries—like service businesses, retail, and high-margin products (think furniture, flooring, or anything where customers take their time before buying)—can often benefit from ad spends in the 7–15% range of total revenue.
Other industries, like manufacturing or wholesale, may see results with a lower percentage due to longer sales cycles and fewer total buyers.
There’s no magic number—but there is a right number for you.
And that’s where we come in.
“The consumer isn’t a moron, she is your wife.”
— David Ogilvy
Why the quote? Because it’s not just about how much you spend.
It’s about understanding your audience, and using your budget to meet them where they are—with the right message, in the right place, at the right time.
What We Do with Your Budget
We treat your money like it’s our own (which is why we’ve talked clients down from spending too much).
We use your ad-to-sales ratio to:
- Build a smart media mix—not just spray and pray
- Match creative to the right channels
- Track what actually matters (hint: not vanity metrics)
- Scale what works
- Cut what doesn’t
In short: we build a strategy you can trust and a system that grows with you.
Ready to Spend Smarter?
If your current “plan” involves boosting a post and praying, let’s talk.
At Agency501, we help businesses build strategy-first campaigns backed by math, messaging, and momentum—not guesswork.
Let’s figure out your number.
And let’s build something that actually works.