What factors influence your total advertising spend?

We are a very customer-focused startup, and we know that cost is not the only factor when determining how much to spend on advertising. What are the factors you consider when deciding how much to allocate to your advertising budget - or even whether it's worth advertising at all!

Top voted answer
Lisa Ormenyessy

Lisa Ormenyessy, Business Coach and Marketing Specialist at

Top 10% Online Business

I totally concur Steve, another number you will want to work out is the life time value of a client against the acquisition cost of the client.

For example - if you spent $100's of dollars and only picked up one client whose first purchase with you was only $50 then on the face of it it would look like a poor ROI.

However - If over the next 3 years that customer ends up spending $20,000 with you (as $50 was your entry level product and you continue to up sell throughout your marketing/sales funnel) then a couple of hundred dollars spend for a $20K client is good.

Steve Osborne

Steve Osborne, director at Stephen Roger Osborne


The only thing that influences advertising spend is ROI – return on investment.

After you've factored in all the variables – available budget, target market, sales cycle, media channel, creative execution, desired outcome, plus a little bit of gut feeling – you're left with measuring how many prospects/leads/enquiries/sales were generated per dollar spent.

That measurement assumes you've defined what a good quality lead looks like, as opposed to a large volume of enquiry from less-than-perfect candidates.

For example, a low-cost competition campaign on Facebook may yield X entries, only a small percentage of whom are actually interested in purchase. As opposed to spending the same amount on direct mail to a targeted database, and receiving far fewer, but more highly qualified leads.

To that end, there is in my view, no difference between "brand" and "retail" advertising. Unless the campaign achieves a ROI, it can be judged to have failed. Sometimes we have to learn these lessons the expensive way.