How Much Should You Spend On Your Online Marketing Strategy?
When it comes to any online marketing strategy, most people can agree that without proper planning you could easily overspend. 61% of marketers agreed that improving SEO and their organic reach was one of their top priorities, but the question is, 'how should you spend your online budget?'
The tactics and techniques you use in your marketing can make a huge impact on how much your overall strategy costs you. The challenge is deciding what is worth your time, what is worth your money, and what's going to work for you long term.
Prioritizing and deciding on a marketing strategy is key to success and this article will help you understand what you should be spending your time and money on when it comes to online marketing.
Read on below for all the answers.
First, Decide on What the Goal Is?
Before you can get started with your online marketing strategy, you first have to understand what the goal is. Are you aiming to get more conversion? Do you need more traffic?
Understanding what you are trying to achieve should be the first step in your campaign to online domination. 63% of companies say their top marketing challenges are generating traffic and leads.
If you are a B2C brand, then you'll only be targeting two major goals:
- Brand awareness
Within each of those goals, you'll have smaller more focused goals. For brand awareness your goals may be:
- Social follower growth
- Social engagement
- Downloads or views of content
- Shares of your content
For sales the goals may look like:
- Increasing your average order value
- Retaining more customers (increasing customer lifetime value)
- Getting first-time buyers to convert
Understanding what you are trying to achieve is key to success.
Check Your Previous Campaigns
One of the biggest indicator's of what is working and what isn't working is to look at your previous campaigns. By using a variety of what worked well in a previous online marketing strategy, you can save time and often achieve similar or better results.
Checking your previous campaigns also gives you the opportunity to look at how much your previous spend was, which helps to assess how much you should be spending on your next budget.
Using past campaigns to assess your budget is a great indicator of deciding where to spend your online marketing budget.
Do the Research
To understand how much your online marketing strategy is going to cost you, you need to learn about the digital marketing landscape within your industry. There are a few questions you should be asking yourself when doing your research.
Think about in which areas your competition appear to be investing the largest part of their marketing budget.
Try to understand which keyword themes or groups you should be targeting in organic and paid for searches and work out the estimated bids for those particular phrases.
Figure out which social platform your audience is using the most. Understand where the majority of your audience is and how much it costs to advertise on that network.
Who are the key social influencers in your chosen niche? What would be the estimated costs of working directly with those influencers?
What's The Content Cost
Make sure to figure out if you have somebody within your organization who can produce the content and has the skillset for it. Otherwise, you'll need to calculate costs of externally hiring a freelancer to perform the work.
How large is your email database? You need to identify what the ideal way to distribute to your email audience is and as that audience grows what would need to change and how much would that cost.
Understand What You Can Spend
The biggest question any company asks when considering a new online marketing strategy is 'how much should we be spending on digital marketing?'. Everyone loves the 'how long is a piece of string?' questions, and as you may have already guessed, everybody's answer to that question will be different.
What you can spend is completely unique to your brand and will depend on a wide variety of different factors including how much money you have as a startup fund, current income and revenue and other business objectives.
Look at what you have available to your marketing department right now and do the research on what a company in your sector usually spends. The average marketing spend compared to company revenue on a B2C product would come in at around 10% for example.
How to Allocate Your Marketing Budget
You can expect the average firm in 2018 to allocate 41% of their marketing budget to online spending. Understanding where you want to allocate your marketing budget is crucial to success.
Your process for outlining your business objectives and priorities should help to give you a clear idea of which marketing channels are going to help you achieve the goals you want to achieve.
Start deciding how you are going to allocate your marketing budget by creating a list of all the different channels and tactics you have at your disposal.
You can use different types of marketing such as:
- Content marketing
- Email marketing
- Social media marketing
- Paid search
- Display adverts
- Website and conversion optimization
- Inbound marketing for mobile
You should then analyze which channels are going to give you the biggest impact on the goals you've set. Those channels are the ones you should allocate your budget to abundantly.
It's usually far more effective to invest wisely in a few channels instead of spreading yourself thin across multiple different channels in the hopes of one of them catching.
It's never a bad idea to keep some funds back in reserve that will remain unallocated. You can use this money last minute to support any new initiatives or bolster a campaign that is succeeding.
Which Online Marketing Strategy Will You Invest In?
Understanding what to spend your budget on within your online marketing strategy can be daunting. If you need support in deciding what works best for your organization, reach out to us today.