E-Commerce Finance
Multi-Channel Budget Optimizer
The Multi-Channel Budget Optimizer reallocates your ad budget across Meta, Google, and TikTok based on each channel's ROAS to maximize total revenue. It returns your current and optimal blended ROAS, the projected revenue increase in euros and percent, and a recommended spend level per channel with its revenue impact. The result is a data-driven starting point for shifting budget toward what performs best.
Who it's for: DTC media buyers splitting budget across Meta, Google, and TikTok who want a quick, ROAS-weighted reallocation to test against their current split.
How the Multi-Channel Budget Optimizer works
You enter a total monthly budget and the current spend and ROAS for each channel you run. The tool calculates your current total spend, current revenue (each channel's spend times its ROAS), and current blended ROAS across the channels with spend.
It then allocates the total budget proportionally to each channel's ROAS weight, so higher-performing channels receive a larger share. To stay realistic it applies a 5 percent diminishing-returns factor when a channel's optimal spend exceeds its current spend, acknowledging that ROAS tends to soften as you scale a channel.
The optimized revenue and optimal blended ROAS are compared against your current figures to show the projected revenue lift in euros and percentage, and each channel gets a recommended spend with its expected revenue change. The tool recommends shifting budget gradually in 10 to 20 percent steps and measuring over 2 to 4 weeks.
The formula
Current blended ROAS = sum(channel spend x channel ROAS) / total current spend. Optimal spend per channel = (channel ROAS / sum of all channel ROAS) x total budget. A 5% diminishing-returns factor is applied when optimal spend exceeds current spend. Revenue increase = optimal revenue - current revenue.
Frequently asked questions
How does the optimizer decide where to move budget?+
It weights each channel by its ROAS relative to the others, then allocates the total budget proportionally so the highest-ROAS channels receive the most. This is a simple efficiency-based reallocation. It is a directional starting point rather than a guarantee, because real channels have audience saturation and interaction effects the model approximates with a diminishing-returns factor.
What are diminishing returns and why does the tool include them?+
Diminishing returns means that as you pour more budget into a single channel, each additional euro tends to earn less because you exhaust the best audiences first. The optimizer applies a 5 percent reduction to a channel's ROAS when its recommended spend exceeds current spend, so it does not naively assume you can scale a high-ROAS channel infinitely at the same return.
Why shouldn't I shift all my budget to the highest-ROAS channel at once?+
Concentrating budget can quickly saturate a channel, raise costs, and inflate apparent ROAS through attribution overlap. The tool recommends moving budget in 10 to 20 percent increments and measuring impact over 2 to 4 weeks so you can validate that the extra spend actually produces incremental revenue before committing further.
Where do I get accurate per-channel ROAS to enter?+
Use platform-reported ROAS as a starting input, but be aware it is often inflated by attribution overlap and view-through, so the highest-reported channel may not be the most incremental. For a more reliable allocation, validate your channel ROAS against Shopify revenue or incrementality tests before trusting the recommended split.