Quick answer: How much to spend on Facebook ads depends on your cost per lead: budget for enough leads each week for Meta to learn, often $30–$60 a day to start.
“How much should I spend?” is usually the first question, and the honest answer is: enough to get meaningful results, and no more than you can afford to test with. Here’s a simple way to work out a sensible starting budget.
Start from what a customer is worth
Before choosing a budget, work out two numbers:
- What a new customer is worth to you in profit, not revenue. If a typical job is $2,000 and your margin is 30%, a customer is worth about $600 (more if they come back).
- How many enquiries it takes to win one job. If you win about one in four quotes, you need four enquiries per customer.
In that example you could afford to pay up to about $150 per enquiry ($600 ÷ 4) and still break even on the first job. That number guides everything else.
Give Meta enough data to learn
Meta’s delivery system learns from results. Meta’s own guidance is that an ad set exits the “learning phase” after about 50 optimisation events (for example, 50 leads) within a week of the last significant edit. Most small businesses won’t hit 50 leads a week, and that’s fine, but a budget that only produces two or three leads a month gives the system very little to work with.
A practical rule: aim for a budget that can produce at least a handful of leads per week at the cost per lead you expect.
A simple starting formula
- Estimate your likely cost per lead. If you don’t know it yet, start with a conservative guess, then replace it with real data after two to four weeks.
- Decide how many leads per week you want to test with, for example five.
- Multiply: five leads × $40 estimated cost per lead = $200 a week, or roughly $870 a month.
For many local service businesses, that lands somewhere between about $20 and $50 a day to start. Some niches need more, especially where competition is high.
Keep the structure simple
A small budget spread across many campaigns, ad sets and audiences means none of them get enough data. Start with one campaign, one or two ad sets and three to five ads. See how to structure a Meta ads account for a small business.
Give it time before judging
Results usually swing in the first week or two while Meta learns. Avoid editing every day, because significant edits restart the learning. Judge on two to four weeks of data, and on cost per real enquiry, not clicks or likes.
Remember the other costs
- GST: Meta charges GST on ads for Australian business accounts, so budget for it.
- Creative: fresh images or short videos every few weeks keep results steady.
- Management: if someone runs the ads for you, their fee is separate from ad spend.
The short answer
Work out what a customer is worth, set a budget that can realistically produce a few leads a week, keep the account simple, and give it a few weeks. Then scale up what works. For more, read setting a starting ad budget.
Sources and further reading
Written by Gregory
20 years building websites and running lead generation, mostly with my own money on the line. Based in Sydney, working with clients worldwide. How I work →