Is your ad spend making you money?
Your ads are profitable when the gross profit from the clients they bring in is more than your ad spend plus fees. Work out what one new client costs you all-in, compare it with the gross profit on their first sale, and you'll know.
Put in what you spend and what happens to the leads. You'll see what one new client really costs you, whether the ads pay for themselves, and which number to fix first.
- Judged on cost per client, not cost per lead
- No email needed, nothing leaves your screen
- Your own numbers, with the maths shown
−$1,833 a month
On the first sale, each client costs you $1,687 but only leaves $1,000 gross profit.
That's fewer than 5 new clients a month, so one sale more or less moves this a lot.
Cost per client (all-in)
$1,687
Break-even cost per client
$1,000
Cost per client (ads only)
$1,125
Target cost per client (set a profit goal)
$1,000
Where your money goes each month
Most you can pay at each step
In ad spend, keeping your other costs in the same proportion. Above these, you miss the goal.
| Step | Now | Break even |
|---|---|---|
| Per lead | $45.00 | $26.67 |
| Per booked call | $225 | $133 |
Where profit leaks each month
Gross profit those people would have brought if they'd gone on to buy at your own rates.
- Leads who never booked a call (53)
- $10,667
- Calls held that didn't buy (11)
- $10,667
What to fix first
Start with leads who book a call. Lifting it from 20% to 28% adds about $1,067 profit a month, the biggest gain of the three.
Each rate lifted by a tenth of the room it has left to 100%:
- Leads who book a call: 20% → 28%, +$1,067 a month
- Calls held that become clients: 20% → 28%, +$1,067 a month
- Booked calls that show up: 100% → 100%, +$0 a month
To break even, any one of these on its own gets you there:
- Leads who book: 20% → 33.7%
- Calls that become clients: 20% → 33.7%
- Average first sale: $2,000 → $3,375
- Cost per lead: $45.00 → $26.67
When the money comes back
- Months to win back what a client cost
- Not on the first sale
- Gross profit collected in the first 30 days
- $1,000
- 30-day gross profit ÷ cost per client
- 0.59×
The 30-day ratio is based on Hormozi's client-financed acquisition idea: at 1× or more, a new client's first 30 days of gross profit covers what it cost to win them.
Return on ad spend
- ROAS (new-client revenue ÷ ad spend)
- 1.78×
- Break-even ROAS
- 3×
- POAS (gross profit ÷ ad spend)
- 0.89×
- POAS needed to cover all costs
- 1.5×
- MER (new-client revenue ÷ all acquisition spend)
- 1.19×
These use your own sales. The ROAS your ad platform reports only counts sales it can see, so it misses sales closed by phone, in person or long after the click.
What if your rates changed?
Faster follow-up usually lifts bookings, reminders lift show-ups, and better calls lift closes. Move the sliders to what you think you could reach. It's your estimate, not a promise.
| Measure | Now | What if |
|---|---|---|
| New clients | 2.7 | 4(+1.3) |
| Cost per client | $1,687 | $1,125(−$562) |
| Profit a month | −$1,833 | −$500(+$1,333) |
More numbers
- Revenue from new clients (first sale)
- $5,333
- Gross profit per client (first sale)
- $1,000
- Most you can pay per lead and break even
- $26.67
- Your cost per lead now
- $45.00
Track this weekly
Take your break-even and target cost per client into the free Acquisition Dashboard and check them against real numbers each week. It stays in your browser.
Track this weeklyHow this is calculated
Every number comes from what you type in. We don't apply industry averages or assumed rates.
- Leads =
ad spend ÷ cost per lead, or(ad spend ÷ cost per click) × visitors who become leads - Calls booked =
leads × leads who book· Calls held =calls booked × show rate(100% unless you set it) · Clients =calls held × calls that become clients - Cost per lead =
ad spend ÷ leads· Cost per call =ad spend ÷ calls - All-in spend =
ad spend + fees + other sales costs + your sales hours × hourly value + commission % × first-sale revenue - Cost per client (all-in) =
all-in spend ÷ clients· Cost per client (ads only) =ad spend ÷ clients - Gross profit per client =
first sale × (1 − refunds %) × gross margin − first sale × processing fee % - Lifetime gross profit =
gross profit per client + (lifetime value − first sale) × (repeat-work margin − processing fee %) - Profit from ads =
clients × gross profit per client − all-in spend - Break-even cost per client =
gross profit per client· Target cost per client =gross profit per client − monthly profit goal ÷ clients - Most you can pay per lead, booked call or call held =
cost at that step now × goal cost per client ÷ all-in cost per client - Profit leak at each step =
people who drop out × the rest of your funnel × gross profit per client - Payback = the first month in which the gross profit collected (equal monthly payments, first one now) reaches the cost per client. 30-day ratio =
gross profit collected in the first 30 days ÷ cost per client - ROAS =
new-client revenue after refunds ÷ ad spend· POAS =clients × gross profit per client ÷ ad spend· MER =new-client revenue ÷ all-in spend - Break-even ROAS =
(fixed costs × first sale × (1 − refunds %)) ÷ (gross profit per client after commission × ad spend), which is(ad spend + fees) ÷ (ad spend × margin)in the simple view - “What to fix first”: each rate is lifted by a tenth of the room it has left to 100% and ranked by the extra profit. Because the funnel multiplies, the same relative lift on every rate would give the same answer, so this points to the leakiest stage.
See the whole system working at the free live training
How we bring in leads, answer every one in minutes and judge every dollar on cost per client.
Questions about the calculator
How does the Ad Profit Calculator work out my profit?
It turns your ad spend into leads using your cost per lead, or your cost per click and the share of visitors who become leads. Then it applies your booking rate and close rate to get new clients. Profit from ads is new clients times gross profit per client, minus ad spend and fees.
What is cost per client, and why does it matter more than cost per lead?
Cost per client is your ad spend plus fees, divided by the new clients the ads bring in. A cheap lead that never books or buys still costs you money, so cost per client is the number that tells you whether the ads pay for themselves. If it's higher than the gross profit on a first sale, you lose money on the first sale.
What does "What to fix first" tell me?
It lifts your booking rate, show rate and close rate in turn by a tenth of the room each has left to 100% (so 20% becomes 28% and 80% becomes 82%), and ranks them by the extra profit. That points to your leakiest stage. If you're short of your goal, it also shows what booking rate, close rate, first sale or cost per lead would get you there on its own.
Where do the what-if numbers come from?
From you. The sliders are your own estimates of the booking, show and close rates you could reach. The calculator doesn't assume any lift; it only shows what your chosen rates would do to new clients, cost per client and profit.
What does the verdict mean?
Losing money: each new client costs more, all-in, than the gross profit on their first sale. Profitable: they cost less, but you wait more than 30 days to get the cost back. Paying for itself: the gross profit you collect in a client's first 30 days already covers what they cost. Too early to tell: most of this period's leads haven't had your usual time from lead to sale yet.
What goes in "Add the full picture"?
Optional detail that makes cost per client and profit more accurate: other sales costs, commission, your own sales hours, show rate, payment plans, payment fees, refunds, repeat-work margin and how long leads take to buy. Leave it closed and the calculator uses the simple view.
Do I need to give my email, and is anything saved?
No email is needed and nothing you type is saved or sent. The maths runs in your browser.
Is the result a promise of what I'll earn?
No. It's an estimate built only from the numbers you type in, in AUD excluding GST. It doesn't include tax, so treat it as a guide and check it against your own accounts.
This calculator is an estimate built only from the numbers you type in. It is not a promise of results. All amounts are AUD excluding GST. It doesn't include tax, so treat it as a guide and check the results against your own accounts.