PPC Financial Calculator & Modeling
Process
- Ask the user what calculation they need (or detect from context)
- Collect required inputs (from pasted data, exports, or verbal description)
- Perform calculations with clear formulas shown
- Present results with interpretation and recommendations
- Flag any concerning metrics or benchmarks
Calculators
1. CPA Calculator
CPA = Total Spend / Total Conversions
Inputs needed:
- Total ad spend (period)
- Total conversions (same period)
Output:
- CPA with period context
- CPA trend (if historical data provided)
- Comparison to industry benchmark (from benchmarks.md)2. ROAS Calculator
ROAS = Revenue from Ads / Ad Spend
ROAS% = (Revenue - Spend) / Spend × 100
Inputs needed:
- Total ad spend
- Total revenue attributed to ads
Output:
- ROAS as ratio (e.g., 3.5x) and percentage (250%)
- Break-even ROAS (based on margins if provided)
- Comparison to platform benchmarks3. Break-Even Analysis
Break-Even CPA = Average Order Value × Profit Margin
Break-Even ROAS = 1 / Profit Margin
Inputs needed:
- Average order value (AOV) OR average deal value
- Profit margin (gross margin %)
- Current CPA or ROAS
Output:
- Maximum profitable CPA
- Minimum profitable ROAS
- Current headroom (how far above/below break-even)
- Recommendation: scale, maintain, or cut4. Impression Share Opportunity
Impression Share Lost (Budget) = opportunity from budget increase
Impression Share Lost (Rank) = opportunity from bid/quality improvement
Revenue Opportunity = Current Revenue × (1 / Current IS - 1)
Inputs needed:
- Current impression share %
- IS lost to budget %
- IS lost to rank %
- Current spend and conversions
Output:
- Estimated additional conversions from full IS
- Budget needed for full IS (estimated)
- Priority: budget increase vs quality improvement5. Budget Forecasting
Projected Spend = Daily Budget × Days in Period
Projected Conversions = Projected Spend / Historical CPA
Projected Revenue = Projected Conversions × AOV
Scaling scenarios:
- Conservative: +20% budget → estimated impact
- Moderate: +50% budget → estimated impact
- Aggressive: +100% budget → estimated impact (with diminishing returns caveat)
Inputs needed:
- Current daily budget
- Historical CPA (last 30 days)
- Forecast period
- AOV (if revenue projection needed)
Output:
- 3 scenarios with spend, conversions, revenue projections
- Diminishing returns warning for aggressive scaling
- 20% scaling rule reminder (never increase >20% at a time)6. LTV:CAC Ratio
CAC = Total Marketing Spend / New Customers Acquired
LTV = Average Revenue per Customer × Average Customer Lifespan
LTV:CAC Ratio = LTV / CAC
Inputs needed:
- Total marketing spend (all channels)
- New customers acquired
- Average revenue per customer (monthly or annual)
- Average customer lifespan (months)
- Optional: gross margin for unit economics
Output:
- LTV:CAC ratio with interpretation:
- <1:1 = losing money on every customer
- 1:1-2:1 = break-even to marginal
- 3:1 = healthy (SaaS benchmark)
- 5:1+ = may be under-investing in growth
- Payback period: months to recover CAC
- Recommendation based on ratio7. MER (Marketing Efficiency Ratio)
MER = Total Revenue / Total Marketing Spend
Inputs needed:
- Total business revenue (period)
- Total marketing spend across ALL channels (same period)
Output:
- MER ratio (e.g., 5.0x)
- Interpretation:
- E-commerce: 3-5x typical, 8x+ excellent
- SaaS: 5-10x typical (higher margins)
- Local service: 3-8x typical
- Comparison to business-type benchmark
- Note: MER captures blended efficiency including organic, brand, and retentionIncrementality & Advanced Measurement
For advanced accounts evaluating cross-channel contribution:
- Meta Incremental Attribution (launched April 2025): AI-powered holdout testing measuring real causal impact. Evaluate if budget exceeds $5K/month.
- Google Meridian (2025): Open-source Marketing Mix Model for incrementality measurement across channels.
- These tools complement PPC math calculations by measuring what would NOT have happened without the ad spend.
For large accounts detecting small effects (5% MDE), multiply the 10% MDE sample by ~4x.
Quick Formulas Reference
| Metric | Formula |
|---|---|
| CPA | Spend / Conversions |
| ROAS | Revenue / Spend |
| CTR | Clicks / Impressions × 100 |
| CVR | Conversions / Clicks × 100 |
| CPC | Spend / Clicks |
| CPM | (Spend / Impressions) × 1,000 |
| CPL | Spend / Leads |
| Break-Even CPA | AOV × Margin% |
| Break-Even ROAS | 1 / Margin% |
| LTV | ARPU × Avg Lifespan |
| CAC | Total Marketing / New Customers |
| MER | Total Revenue / Total Marketing |
| Impression Share Opp | Revenue × (1/IS - 1) |
Output Format
## PPC Financial Analysis
### [Calculator Name]
**Inputs:**
- [Listed inputs with values]
**Results:**
| Metric | Value | Benchmark | Status |
|--------|-------|-----------|--------|
| [Metric] | [Value] | [Benchmark] | PASS/WARNING/FAIL |
**Interpretation:**
[1-2 sentence analysis]
**Recommendation:**
[Actionable next step]Data to Request
If the user doesn't provide enough data, ask for:
- Platform and campaign type
- Time period for analysis
- Spend and conversion data
- Revenue data (if ROAS/break-even needed)
- Margin data (if break-even/LTV needed)
- Business type (for benchmark comparison)