Draper Digital

Plan / Free PPC tool

Lead value & target CPL calculator

Connect the value of a customer to the price you can afford to pay for a lead. Allow for your close rate, sales costs and the contribution you want to keep.

Your inputs

Example values

Change the example figures to use your own. Values stay in this browser tab.

Use one consistent period, net of refunds and tax you pass on.

After delivering the sale, before sales costs and advertising.

Customers won divided by all leads in the same mature cohort.

Average variable cost of handling every lead, including leads that do not buy.

Share of contribution after sales costs to keep for overheads and profit.

Leads divided by paid clicks. Used to estimate your affordable CPC.

Your results

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Free to use. No signup. Inputs are processed in your browser and are not sent to Draper Digital.

Understand the numbers

How to use this calculator

Follow the lead through to a sale

Use leads and customers from the same cohort and allow enough time for sales to close. If your advertising measures all enquiries, use the close rate for all enquiries. A qualified-lead close rate applied to all enquiries would overstate their value.

Keep room for overheads

The retained share is a percentage of contribution after the entered sales costs, not a net profit margin on revenue. Fixed costs and costs you have not entered still need covering. A zero advertising allowance means these assumptions leave no room to buy leads.

A worked example

A £2,000 customer at a 50% contribution margin and a 10% close rate is worth £100 in expected contribution per lead. Subtract £10 of sales costs and retain 25% of the remaining £90: target CPL is £67.50. At a 5% click-to-lead rate, affordable CPC is about £3.38.

A little more context

Common questions

Can I use lifetime customer revenue?

Yes, if revenue, margin and the close rate refer to a consistent, evidenced customer cohort. Consider cash flow and payback time before using long-term revenue to fund today’s leads.

Is this the target CPA I should put into Google Ads?

It is an economic planning ceiling. A bidding target also needs reliable conversion tracking, enough data and an achievable account history. Do not set it automatically from this calculator.

What happens with a zero close rate?

Expected revenue per lead is zero and there is no advertising allowance. The tool still shows any negative contribution caused by sales costs.

Keep the work moving

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