Wizard of Ads™

Cost of Exposure Calculator

How much should a home service company invest in brand advertising?

Projected Annual Revenue

Profit Margin

Markup

Change either value. The other adjusts automatically.

Not sure of your margin? Calculate it from a typical job:

Enter what you charge and what it costs you for a typical full install.

You Charge

Your Direct Costs

Direct costs = equipment, parts, labor, permits

Gross Profit $4,000

Margin 47.1%

Markup 88.9%

Enter what you charge and what it costs you for a typical service or maintenance job.

You Charge

Your Direct Costs

Direct costs = parts, labor, truck roll

Gross Profit $225

Margin 50.0%

Markup 100.0%

Margin is gross profit as a percentage of what the customer pays.
Markup is gross profit above cost, as a percentage of your direct costs.

Example

You charge the customer

$450

Your direct costs

$225

Gross profit

$225

→

Margin = $225 ÷ $450

50.0%

→

Markup = $225 ÷ $225

100.0%

Your Numbers

Annual Revenue

Direct Costs

Gross Profit

→

Your Margin

→

Your Markup

Annual Rent

A high-visibility location does some of your advertising for you. Home service companies usually need to advertise more than retail businesses because their location rarely creates walk-in awareness. Your advertising has to do the work a storefront would do for a retailer.

“A business with a good sign in a high-visibility location will need to advertise significantly less than a similar business in an affordable location.”

Roy H. Williams, The Wizard of Ads

Your Cost of Exposure

Recommended Branding Budget

Minimum

$56,300

$4,692/mo

Maximum

$74,760

$6,230/mo

10% of projected revenue

12% of projected revenue

Margin → Markup

What Does This Budget Cover?

This formula calculates your cost of exposure: the investment needed to build share of mind so that when someone needs what you sell, they think of you first and feel best about you. It covers relational/brand advertising. Sales activation and other marketing investments are budgeted separately.

✓ Included in This Budget

Radio: mass reach, frequency, share of mind

Television: broadcast and cable

Streaming / OTT: connected TV, pre-roll video

Billboards / OOH: outdoor and transit

Streaming Audio: Spotify, Pandora, podcasts

YouTube: pre-roll, in-stream, brand channels

Truck Wraps: mobile billboards, fleet branding

Social Media (brand-building): relational content on Meta

✗ Budgeted Separately

Google Ads / PPC: search demand capture

Local Service Ads: in-market lead capture

Retargeting / Remarketing: follow-up direct response

Promotional Meta Ads: offers, lead forms, call-now campaigns

SEO / Content: organic search optimization

Website: design, hosting, maintenance

Email / SMS Promotions: direct-response campaigns

Note: Rent is already factored into the formula as location-based exposure. This calculator covers media spend only. Consulting and strategy fees are separate.

Total Marketing Budget Breakdown

We first calculate your Cost of Exposure, the recommended budget for relational/brand advertising. Then we treat that number as 60% of your total marketing budget, based on the 60/40 starting split between relational and sales activation.

Total Marketing Budget = Cost of Exposure ÷ 0.60

Relational / Sales Activation Split

60% Relational / 40% Sales Activation

60/40 is a balanced long-term growth split.

Minimum

Relational (60%)
Sales Activation (40%)
Total

Maximum

Relational (60%)
Sales Activation (40%)
Total

Decision Time

Now you have a proven framework for your advertising and marketing investment. This is still a guide, not a command. The real decision is yours: advertise aggressively and aim to lead the market, or play it safer and grow more slowly.