# Budget Allocation — Models, Benchmarks & Templates

## Allocation Models

### 70/20/10 Model

| Tier | Allocation | Purpose | Examples |
|------|-----------|---------|---------|
| **Proven** | 70% | Channels with demonstrated ROI | Top-performing search, retargeting, email |
| **Testing** | 20% | Channels with promising signals | New audiences, emerging platforms, content experiments |
| **Experimental** | 10% | Unproven bets with upside potential | New platform, influencer test, podcast sponsorship |

**When to use**: Established businesses with performance history. Allows growth while managing risk.

### Efficiency-Ranked Allocation

Rank channels by CAC (lowest to highest) and allocate budget until each channel reaches saturation:

1. Calculate CAC per channel from historical data
2. Rank channels: Organic/SEO → Email → Referral → Paid Search → Social Ads → Display
3. Allocate budget to the most efficient channel until marginal CAC rises
4. Move to the next channel and repeat
5. Stop when marginal CAC exceeds LTV threshold

**When to use**: Performance-focused businesses optimizing for ROI.

### Funnel-Weighted Allocation

| Business Model | Awareness | Consideration | Conversion | Retention |
|---------------|-----------|---------------|-----------|-----------|
| B2B SaaS | 30% | 35% | 20% | 15% |
| eCommerce | 25% | 15% | 45% | 15% |
| DTC | 35% | 15% | 30% | 20% |
| B2B Services | 25% | 40% | 25% | 10% |
| Local Business | 30% | 20% | 35% | 15% |
| Marketplace | 35% | 20% | 30% | 15% |

**When to use**: When you need to balance brand building with performance marketing.

---

## Channel Cost Benchmarks

### Search Ads (Google)

| Industry | Avg CPC | Avg CPL | Avg CVR |
|----------|---------|---------|---------|
| B2B SaaS | $3-8 | $50-150 | 2-5% |
| eCommerce | $1-3 | $15-45 | 2-4% |
| Finance | $5-15 | $40-100 | 3-6% |
| Healthcare | $3-8 | $35-80 | 3-5% |
| Legal | $5-50 | $50-300 | 2-4% |
| Real Estate | $2-5 | $30-80 | 2-4% |

### Social Ads (Meta)

| Industry | Avg CPM | Avg CPC | Avg CPL |
|----------|---------|---------|---------|
| B2B SaaS | $15-35 | $2-5 | $30-100 |
| eCommerce | $8-20 | $0.50-2 | $10-30 |
| DTC | $10-25 | $1-3 | $15-40 |
| Local | $5-15 | $0.50-2 | $10-25 |

### LinkedIn Ads

| Format | Avg CPC | Avg CPM | Avg CPL |
|--------|---------|---------|---------|
| Sponsored Content | $5-12 | $30-80 | $50-200 |
| Message Ads | $0.30-0.80/send | — | $40-150 |
| Lead Gen Forms | $4-10 | $25-60 | $30-100 |

---

## Budget Reallocation Triggers

Shift budget when you observe:

| Trigger | Action |
|---------|--------|
| Channel CPA exceeds target by >30% for 2+ weeks | Reduce budget 20-30%, reallocate to better performers |
| Channel delivers <50% of expected conversions midway | Pause and investigate before reallocating |
| New channel test achieves CPA within 20% of target | Increase budget gradually (20% per week) |
| Seasonal spike approaching | Pre-allocate 10-20% more to conversion channels 2 weeks before |
| Competitive intensity increases (CPCs rising) | Shift to less competitive channels or long-tail |
| ROAS drops below 2:1 on any channel for 2+ weeks | Reduce or pause, diagnose root cause |

---

## ROAS Targets by Channel

| Channel | Minimum ROAS | Good ROAS | Excellent ROAS |
|---------|-------------|-----------|---------------|
| Google Search (branded) | 5:1 | 8:1 | 15:1+ |
| Google Search (non-branded) | 2:1 | 4:1 | 8:1+ |
| Google Shopping | 3:1 | 5:1 | 10:1+ |
| Meta Ads | 2:1 | 4:1 | 8:1+ |
| LinkedIn Ads | 1.5:1 | 3:1 | 5:1+ |
| Email Marketing | 10:1 | 30:1 | 40:1+ |
| SEO/Content | 3:1 | 8:1 | 15:1+ |

---

## Minimum Viable Budget by Channel

| Channel | Monthly Minimum | Why |
|---------|----------------|-----|
| Google Search | $1,000 | Need enough clicks to learn and optimize |
| Meta Ads | $1,500 | Algorithm needs ~50 conversions/week to optimize |
| LinkedIn Ads | $3,000 | High CPCs require sufficient budget for learning |
| TikTok Ads | $1,000 | Lower CPMs but need creative volume |
| Content/SEO | $2,000 | Writer + tools + promotion (longer payback) |
| Email | $200-500 | Platform cost only (highest ROI channel) |
| Influencer | $500-2,000 | Depends on tier (nano/micro minimum) |

---

## Monthly Budget Template

| Line Item | Jan | Feb | Mar | Q1 Total |
|-----------|-----|-----|-----|----------|
| Google Search — Brand | | | | |
| Google Search — Non-Brand | | | | |
| Google Shopping | | | | |
| Meta Ads | | | | |
| LinkedIn Ads | | | | |
| TikTok Ads | | | | |
| Content Production | | | | |
| Email Platform | | | | |
| SEO Tools | | | | |
| Influencer | | | | |
| PR/Outreach | | | | |
| Creative Production | | | | |
| Testing Reserve (10%) | | | | |
| **TOTAL** | | | | |
