Budget from profit capacity. AOV alone is not enough; your net margin and repeat purchase behavior decide how much CAC you can afford.

Average order value ($)

Net margin (%)

Orders/customer/year

Target LTV:CAC ratio

Monthly revenue target ($)

Target gross ROAS

Max CAC$0

Monthly ad budget$0

Daily budget$0

Set ad spend from economics, not optimism

TikTok can spend faster than your margin can recover. Use a controlled budget that your target ROAS and max CAC can support, then scale only when net contribution is proven.

Metric	Why it matters
Max CAC	Shows the customer acquisition cost your profit can support.
Monthly budget	Connects revenue targets to gross ROAS assumptions.
Daily budget	Creates a practical spend cap for campaign tests.

Track ad spend against real profit

Dashboardly shows whether ad spend is creating actual contribution after every TikTok Shop cost.

TikTok Shop Ad Spend Calculator — Set the Right Budget for Your ROAS Target

Set ad spend from economics, not optimism