Sales & Conversion
Personas
Ecommerce
Time to ROI
Medium-term (3-6 months)
I'll never forget the call I had with an ecommerce client who asked me the same question I hear almost weekly: "How much should I spend on Shopify ads to make this work?"
They had a €50 average order value, were running Facebook ads with a 2.5 ROAS, and thought they were doing "pretty well." The numbers looked decent on paper. Most marketers would call that acceptable. But here's what most people miss—when your margins are slim and you're trying to scale, that 2.5 ROAS can actually be bleeding money.
After working with dozens of Shopify stores and burning through countless ad budgets (both mine and my clients'), I learned that the wrong question isn't about budget size. The wrong question is asking "how much" before asking "why" and "what for."
In this playbook, you'll discover:
Why most Shopify ad budget advice is dangerously wrong
The real cost breakdown of profitable Shopify advertising
My framework for determining your actual advertising capacity
When to pivot away from paid ads entirely (and what to do instead)
The creative-first approach that actually moves the needle
Whether you're planning your first ad campaign or wondering why your current budget isn't delivering, this breakdown will save you from the expensive lessons I learned the hard way.
Industry Reality
What Every Shopify Store Owner Gets Told About Ad Budgets
Walk into any Facebook ads "guru" course or Shopify marketing forum, and you'll hear the same budget advice repeated like gospel:
"Start with $50-100 per day and scale up." They'll tell you to begin with a modest daily spend, test your campaigns, and gradually increase budget as you find winners. Sounds reasonable, right?
"Aim for 3-4x ROAS minimum." The industry standard wisdom says anything above 3x return on ad spend means you're profitable and should keep scaling.
"Budget 10-30% of your revenue for advertising." This percentage-based approach is supposed to give you a sustainable advertising spend.
"Test multiple audiences with small budgets first." The conventional approach focuses on detailed targeting, testing different demographic segments before scaling the winners.
"Scale winning campaigns by increasing daily spend." Once you find a profitable campaign, the advice is always to throw more money at it.
This advice exists because it simplifies a complex decision into easy-to-follow rules. It gives new store owners a starting point and makes Facebook ads "accessible" to everyone. The problem? It ignores the fundamental economics of your specific business.
Here's what this conventional wisdom misses: Your product catalog size, average order value, customer lifetime value, profit margins, and product-channel fit all dramatically impact what constitutes a "good" ad budget. A store selling high-ticket furniture needs a completely different strategy than one selling $20 accessories.
Even worse, this advice often leads store owners to burn through their working capital chasing vanity metrics while their actual profitability suffers. I learned this the hard way.
Consider me as your business complice.
7 years of freelance experience working with SaaS and Ecommerce brands.
Let me tell you about the project that completely shifted how I think about Shopify ad budgets. I was working with an ecommerce client who had what looked like a solid setup: over 1,000 SKUs, decent product quality, and they were running Facebook ads with a 2.5 ROAS.
On paper, that 2.5 ROAS looked acceptable. Most marketers would say "keep scaling." But when I dug into their actual numbers—€50 average order value with small margins—I realized something was fundamentally broken.
The real problem wasn't their ad performance. It was product-channel fit.
Their strength was variety—customers needed time to browse, compare, and discover the right product. But Facebook ads demand instant decisions. We were trying to force a square peg into a round hole, and every euro spent was fighting against their natural customer behavior.
Here's what I discovered: While most successful paid ads campaigns thrive on 1-3 flagship products, my client's strength was their variety. Customers wanted to explore, not buy the first thing they saw in an ad.
This mismatch meant that no amount of budget optimization, audience testing, or creative iteration was going to solve the fundamental problem. We were asking Facebook's quick-decision environment to handle a browse-heavy shopping experience.
That's when I learned the most important lesson about Shopify ad budgets: Before you ask "how much," you need to ask "does this make sense for my business model?"
Sometimes the best ad budget is zero—and I'll show you exactly how to figure that out.
Here's my playbook
What I ended up doing and the results.
After that wake-up call, I developed a completely different approach to Shopify ad budgeting. Instead of starting with industry benchmarks, I start with business reality.
Step 1: The Brutal Math Check
First, I calculate the real cost of customer acquisition. Take your average order value, subtract your product costs, subtract your fulfillment costs, subtract your payment processing fees. What's left is your contribution margin—the actual money available for marketing and profit.
For my client with €50 AOV and small margins, this exercise revealed they had maybe €15 per order available for marketing. With a 2.5 ROAS, they were spending €20 to make €50, leaving €30 in revenue. After costs, they were barely breaking even.
Step 2: The Product-Channel Fit Assessment
I evaluate whether the product catalog actually works with Facebook's advertising format. Products that work well: clear value propositions, emotional purchases, gift items, trending products. Products that struggle: complex comparisons, variety-dependent selections, high-consideration purchases.
My client fell squarely in the "struggle" category with their 1,000+ SKU catalog requiring customer exploration.
Step 3: The Creative-First Pivot
Based on my experience with another Shopify store, I completely abandoned detailed audience targeting. Privacy regulations have killed detailed targeting anyway. Instead, I implemented what I call the "creative-is-targeting" approach:
• One broad campaign (letting Facebook's algorithm do the heavy lifting)
• Multiple ad sets with different creative angles
• 3 new creatives every single week without fail
• Focus on creative diversity rather than audience segmentation
Each creative acts as a signal to the algorithm about who might be interested. A lifestyle-focused creative attracts one segment, while a problem-solving creative attracts another—all within the same campaign structure.
Step 4: The Alternative Distribution Test
For the client whose numbers didn't work with paid ads, I led a complete SEO overhaul instead. We built organic discovery channels that matched their strength (variety and exploration) rather than fighting against it.
The key insight: You can't change the rules of a marketing channel. You can only control how your product plays within those rules.
Budget Reality
Calculate your true available marketing budget by subtracting all costs from AOV, not just product costs
Creative Testing
Produce 3 new ad creatives weekly rather than testing audience segments—this is where the real optimization happens
Channel Fit
Assess whether your product catalog actually works with Facebook's instant-decision format before setting any budget
Distribution Mix
Don't put all budget into paid ads—build organic channels that match your customer's natural shopping behavior
For the client where paid ads made sense, the creative-first approach delivered measurable improvements. Instead of burning budget on audience testing, we focused entirely on creative production and testing.
The campaign structure simplified dramatically: one broad audience, multiple creative angles, consistent testing rhythm. This aligned perfectly with how modern ad platforms actually work—letting the algorithm find the right people for each creative rather than manually defining audiences.
For the client where the math didn't work, abandoning paid ads and focusing on SEO generated significant organic traffic growth. Customers found their products through search, had time to browse the full catalog, and converted at higher rates because they weren't being rushed into quick decisions.
The bigger lesson: Budget size wasn't the determining factor in either case. Business model compatibility with the advertising channel was everything.
Most importantly, both approaches required completely different mindsets about "marketing budget." One required consistent creative production investment, the other required content creation and SEO infrastructure investment.
What I've learned and the mistakes I've made.
Sharing so you don't make them.
1. Math trumps marketing
No amount of optimization can fix fundamentally broken unit economics. Calculate your real available marketing budget first, then decide if paid ads make sense.
2. Product-channel fit is everything
Your product isn't broken if it doesn't work on paid ads. Sometimes you just need to find the channel where your product's strengths become advantages, not obstacles.
3. Creative production beats audience research
In 2025, your creative strategy IS your targeting strategy. Invest in consistent creative production rather than complex audience segmentation.
4. Platform physics can't be changed
Facebook demands instant decisions. SEO rewards patient discovery. LinkedIn favors B2B thought leadership. Work with channel physics, not against them.
5. Budget allocation isn't just about paid ads
Sometimes the best "ad budget" is content budget, SEO budget, or creative production budget. Think distribution strategy, not just advertising spend.
When this approach works best: Complex product catalogs, high-consideration purchases, variety-dependent selections.
When to stick with traditional paid ads: Clear value propositions, emotional purchases, trending products, gift items.
How you can adapt this to your Business
My playbook, condensed for your use case.
For your SaaS / Startup
For SaaS startups, focus budget on channels where you can demonstrate product value over time rather than instant conversions. Consider content marketing and SEO as primary "ad budget" alternatives for complex products.
For your Ecommerce store
For ecommerce stores, assess your catalog complexity first. Simple, emotional products work with paid ads. Complex, variety-dependent catalogs often perform better with organic discovery channels and content investment.