|September 27, 2017||No Comments|
Successful marketing always means successful marketing. You’ll have to market your business as a whole, your services, products, but also manage your customer relationships. This is why knowing how to budget your digital marketing campaign is critical if you want to get results.
If you don’t know how to create the perfect marketing budget, you can go wrong in two ways. You could either over budget your marketing efforts in order to reach new audiences, or you could go the other way, under budgeting your campaign and suffocating results. These are two ways which are disastrous for every business – overspending means losing money and getting minimal results, and underspending means your brand will suffer and may lose its momentum.
So how can you create the perfectly balanced marketing budget that gets results? Let’s take a look:
1. Create the marketing plan
This is the first thing you’ll have to focus on. You need to know your products and services, the target audience (where you want to sell) and create a way to differentiate yourself from your competition. Customers have to know your brand and what it does, how it can help them and how it can answer their questions. This plan should be completed before starting the actual content creation, because it acts as the underlying framework on which your whole marketing campaign is built. This is where you establish goals, numbers, ROIs, create a schedule and outline the costs. Of course, the marketing plan may suffer modifications, but you must have a general layout in the early stages of your campaign.
2. Have a rough outline of costs
There are some general rules of thumb when it comes to marketing budgets. According to experts, most companies should spend anywhere from 2 to 12 percent of their revenue on marketing. Here is a breakdown:
3. Break down your costs
After you decided on a general budget for your whole marketing campaign, you’ll have to break down these numbers into several categories. This is where things tend to get a little complex and depend vastly on your niche, your audience and products or services. Here are some categories to focus on:
Luckily, there are a lot of studies which can help you determine what percentage to go for each category. Of course, these numbers can vary depending on multiple factors. For instance, a company which has an online shop may spend more on social media. Similarly, a company focused on B2B services may spend more on lead conversion or email marketing. Also, you should adapt the costs depending on your industry, the local market, your competitors and your specific goals.
For instance, recent data* published by Forrester, an American marketing analytics company based in Cambridge MA, if your marketing budget is $100,000, your breakdown for 2018 should be looking like this:
4. Marketing is an investment
Some managers see marketing as a cost. This is mainly because they see the marketing department as a costly division and don’t really understand the importance of online marketing. Obviously, they couldn’t be further from the truth. Just by looking at past expenditures and ROIs, you can see that marketing, when done correctly, is an actual investment. It’s both an investment when it comes to financial revenues, but also in terms of popularity, prestige and branding (which cannot be evaluated from a financial standpoint immediately). Your marketing budget is much more than just money, it’s investment in the future, in fruitful relationships with your customers and suppliers.
5. Analyze and adjust
Marketing is an ongoing process that needs to be constantly adjusted. Campaigns shouldn’t be viewed as one hit wonders, but as continuous, evolving organisms. They have to be nurtured and adapted to guarantee the best results. Your budget may be $100,000, but it has to be spread over a whole year, on multiple micro-campaigns, depending on your needs. Always keep an eye out on previous successes or failures. Monitor everything and adapt your costs:
In short, make sure you are constantly up to date on new developments in your niche or your industry and adapt your campaign.
Creating a good marketing plan takes a lot of effort and resources. You’ll have to plan carefully, estimate budgets and micromanage separate campaigns. However, no matter the effort, it’s worth it, especially in the long run. From a financial perspective, your business will grow, but you’ll also enjoy the multiple benefits of increased prestige, better image and respect in the industry, which are often invisible in financial reports.