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Growth Strategy

How Much Should a Bangladeshi Business Spend on Ads? The Capital Allocation Formula

How to budget for growth based on Gross Margins, Average Order Value (AOV), and customer lifetime value rather than arbitrary guesses.

Sarah Chen

Sarah Chen

Head of Strategy & Intelligence

6 min read
How Much Should a Bangladeshi Business Spend on Ads? The Capital Allocation Formula

The Flawed Percentage-of-Revenue Myth

Many business owners in Bangladesh ask: 'Should I spend 10% of revenue on ads?' The reality is that marketing budget should be determined by Contribution Margin per unit and Maximum Allowable Acquisition Cost (MAC).

The Unit Economics Math

If your product sells for ৳2,000 with a cost of goods of ৳800 and courier cost of ৳150, your pre-marketing gross profit is ৳1,050. If you are willing to allocate ৳450 to acquire a new customer, you maintain a ৳600 profit per order and achieve a break-even ROAS of 1.9x.

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