What is the formula to forecast the budget required for a paid search campaign?

To forecast the budget required for a paid search campaign, the correct approach is to multiply the number of clicks you anticipate by the cost per click (CPC). This calculation provides an estimate of how much you will spend based on the expected traffic to your website from the paid search ads.

The reason for this formula is straightforward: if each click costs a certain amount (the CPC), then to find the total cost for a given number of clicks, you multiply the cost per click by the number of clicks you expect to receive. This allows marketers to set a budget that accurately reflects the anticipated expenses associated with driving traffic through paid search advertisements.

This method helps ensure that the campaign's budget aligns with the expected performance and financial resources available, allowing for better financial planning and resource allocation.