Where should the next ad dollar go?
Every channel has diminishing returns, and the optimum is where the last dollar buys the same orders in every channel, the marginal rule from every economics course, enforced by an optimizer.
Marketing Intermediate Optimization free
After you install, this is the model to open.
Split the Ad Budget for Maximum Orders
- In your spreadsheet, click the Sortia icon in the strip of icons down the right-hand edge. No strip? Click the arrow at the bottom-right to open it. You can also use Extensions, then Sortia, then Open Sortia.
- Click Start from a template and put that name in the search box.
- Pick the card with that name and click Load this template. It arrives on a new tab with real numbers already in it.
The answer
Against the equal split's 2,828 orders:
- Optimal split
- $34.2K / $15.2K / $10.6K
- Orders
- 2,919 /month
- Gain over equal thirds
- +90 orders, same money
About 90 more orders from the same budget, found by moving money toward Search until marginal returns equalize. Fit your own curves by regressing orders on spend from channel history, and rerun monthly; the split should move as the curves do.
The model
Orders grow with the square root of spend: Search converts best (coefficient 9), then Social (6), then Video (5). One $60K budget, three spend cells, maximize total orders.
| Budget | $60,000/month |
| Response curves | orders = k x sqrt(spend) |
| Optimal split | optimized |
Once it is in your sheet
- The model arrives with real numbers in it and runs as it stands, so you can press the button first and understand it second.
- Change the numbers to yours. The sheet marks which cells are inputs and which hold formulas, and most labels carry a note explaining the row.
- Press the run button at the bottom of the panel. It is labeled for the tool you are in, and the result lands on its own tab, with a written reading of it beside the figures.
Never used Google Sheets? Start here goes the whole way, in seven steps, and assumes nothing.
Next question
- Who should get the loan offer?Who Should the Campaign Target?
- What CPA will your ad budget actually buy?PPC Campaign Planner
- Is that market study worth paying for?Is That Market Study Worth It?
- If you raise your bid, what does it actually buy?Ad Auction Simulator
- Is that jump in your conversion rate real, or just luck?Is That Rate Real, or Just Luck?
- How big is your serviceable market, really?Serviceable Market Size (SAM) Range
Every model like this one, and the method behind them: Optimization in Google Sheets.