For any business looking to survive and thrive in the modern age, digital marketing is a must. The key question remains, how much of a budget should you be putting into the process, and what are the important factors to consider? There is no doubt what you plan today is going to profoundly affect your future, so it is best to start on the right note and keep bringing in those wins.
In order to set up a good digital marketing foundation, you will need to decide how big your marketing budget is going to be. Here are a few easy steps to help you in making the final decision.
In the meantime, you can also check out our Digital Marketing Pricing Packages for more insight.
Digital Marking Budget Planning
Setting Your Goals
One thing you need is a target to aim for. How are you going to measure success when you have no inkling of what that looks like? Instead of wasting time and effort chasing after something that is unattainable, you need a clear goal that is within reasonable reach.
What are the key performance indicators for the year? What does your ideal customer want to see from your brand? What would be the dominant content format to push out on the various social media platforms?
These are but a few of the questions to answer, and to have defined goals for. This way, you can allocate your digital marketing budget as you see fit, or even try to secure more in order to do something even better.
Familiarize Yourself With Your External Costs
How can you accurately come up with a digital marketing budget when you aren’t aware of the costs that your business has?
Sure, you’re likely aware of what you spend on digital marketing and internal factors such as cybersecurity and virus protection, but do you know how much you’re spending on external factors? If you have employees to handle these aspects for you, chances are that you don’t – even if you might have a general idea.
External factors include things like employing staff (which includes everything from pay checks to benefits), required technology, operations, and costs that occur from simply running a business (electricity, water, internet etc).
It’s important to know how much you’re spending on these factors so that you can allocate part of your existing budget to marketing without being left in a tough situation.
As an example, say it costs you $10 to produce an item. You turn around and sell the item for $50. This information, and the final amount of $40 which is your ROI, should give you a good idea of how much you want to spend while still managing to generate a profit.
Choose Your Platform
A crucial part of planning a successful digital marketing budget is deciding on a platform. This step is dependent on your individual business and which market it caters to.
If you operate on a business-to-business basis then you’ll be appealing to those in managerial positions such as CFOs and CTOs. When this is the case, you’ll need to make sure that your marketing content can be consumed in an office setting, most likely on a laptop or desktop computer. Your content will be appearing on articles and dedicated websites that are relevant to your business.
On the other hand, if your business caters to consumers and the general public, it is likely going to rely on social media marketing content that can be consumed “on the go”. In other words, people will stumble across it when they’re using their smartphones or tablets. This means that instead of posting your content on websites, you should be focusing on content marketing for social media via photos or videos.
Depending on which market you cater to, your digital marketing budget will look a little different. This is why it’s important to choose your primary platform focus for a campaign.
Consider the Stage of Your Business
Your marketing budget will be determined, in part, by whether your business is in the planning or the growth stage of development.
If your business is just starting out and is in growth mode, you’ll need to start generating revenue fast. This means that you’ll want to invest more deeply in digital marketing techniques that are known for their quick turnaround times. This can be more costly than those who use a slow and steady turnaround rate.
When your business is in the planning mode, it’s likely to benefit more from steady growth and less from sudden spikes in revenue. Because of this, you’ll need to invest in a marketing technique that performs better long-term.
Depending on the method you choose for this stage, marketing budgets can vary.
Let The Data Guide Your Marketing Budget Plan
Not learning your lessons can lead to a repeat of mistakes, and mistakes in the digital space can be hard to erase. Understanding what your business needs, what has worked and what has not is very important.
It is not just restricted to your brand and content. Also take a look at how the competition has been doing things, the mistakes they’ve made and you might gain the upper hand.
Having the right data can save you from repeating mistakes of other companies who have experienced spectacular campaign flops focusing on the wrong marketing activities.
When it comes to setting marketing budgets, analyzing the data is a must. Let the marketing data determine your marketing spend and digital marketing strategy.
Align The Pieces
All marketing efforts require two key components – manpower and tools. Without the right tools for the right person, the effectiveness is curtailed. Your marketing budget will need to account for hiring the right manpower and providing the right tools for the job.
Having dedicated staff for specific areas of marketing can bring its own rewards, while proper software and tools can refine the process and increase productivity. Analytical software will also provide you the important information you seek. Nothing works well within a silo, and the more cohesive your digital marketing efforts, the better it is for your company.
Be Forward Facing
Of course, the digital space can change in an instance. Knowing the current trends and how the markets move at the moment is only half the battle. It’s very important, though that you keep track of the hottest trends and where all the action is.
You should also be keeping in touch of potential new opportunities and ventures that could be beneficial for your brand.
Even if something is a new concept, it could still do wonders for your business. Don’t be afraid to take a leap of faith in terms of marketing ventures; you never know how far an idea could get you.
You know your business and target customer best, so keep everything you know about them at the front of your mind when starting something new.
Being aware and keep in mind that getting in early and being amongst the early adopters might give you a leg up on the competition. Do not rule anything out, opportunities are there to be grasped and letting them pass by is often a terrible mistake.
Having foresight in your business can help you make the right decisions in marketing budget planning.
An Agile Marketing Budget
With goals in mind and the requisite knowledge of how to enhance your marketing efforts, it is time to actually start planning said marketing budget. However, an essential guiding principle is not to let cost dictate everything. In fact, you should be prioritizing success as much as possible.
What that means is that not all cost-effective solutions are going to be the best approach, nor will the most expensive approach bring you the best dividends. Instead, you will have to do the hard work of determining what is going to work best for you at any given time.
If the opportunity to build a social media presence is now, then your marketing budget should adjust accordingly. If your target audience is shifting from Facebook to Instagram, you should be changing your approach as well.
Taking advantage of changes and getting better results will make your marketing budget go longer and further.
Seasonal events and holidays can also be prime windows to do something interesting or innovative, so you will have to account for that as well. Be mindful of national holidays and vocation days in the countries that you’re targeting. It wouldn’t make sense to increase marketing spending on a particular campaign when the entire country is taking the week off for a religious holiday or is staying home to celebrate a special day.
In addition, if you set a marketing budget plan and then find that the resulting campaign is incredibly successful, don’t feel obligated to stop the campaign just because you have gone over budget.
If your success is weighing out the fact that you are over budget and you’re still seeing a gain from it, keep going! Why stop during the height of success? Your marketing can be both smart and flexible.
Keep your marketing budget agile, and give yourself the best platform for success.
Overall, decide on the type of content that will drive your marketing efforts, choose the right platforms for the job, and you are well ahead of the pack. Plan out how a typical month will look like, slot in those holiday promotions, and be ready to change things up if a trend starts cropping up.
Knowing what your marketing dollars are getting you and being able to adapt your marketing budget as you go along will make sure that your marketing budget goes to where it is needed most.
It requires plenty of effort to come up with the right digital marketing approach, and budgetary concerns are a key cog of that. If you give yourself the best opportunities to succeed, and take everything into consideration before coming up with your next marketing budget plan, you’ll be in a better position to see favorable results and reach your ideal customer.