Budgeting for Digital Marketing
29th July 2015
How much should I spend on marketing?
Trying to allocate a budget for digital marketing can be challenging, and sometimes it can be challenging to know how much to dedicate towards getting your brand presence known. How much should I dedicate towards normal marketing compared to digital marketing, and how much should your budget be split across to different areas of digital marketing are some common unknowns, and it can be difficult to predict the sort of results you are going to get until you do it. Digital Marketing is different to normal marketing; it is real time and long term. If you market your company digitally for a month a year then you are not going to see any pressing improvements.
How much should I dedicate overall to digital marketing? For a very baseline number to go on, a lot of companies spend around 10% of their overall revenue annually on digital marketing. So if your company gets £1,000,000 revenue annually then your monthly digital marketing budget would be somewhere in the £8000 - £8500 range. Now that is industry standard, there is no minimum or maximum that you can spend on digital marketing, however if you want an effective campaign then you will not achieve it on leftovers, and the future growth of your company can be affected hugely by digital marketing alone.
What aspects of digital marketing should I dedicate the most money to?
There are a few different aspects to digital marketing that will serve for different purposes, and if you do not have a large budget then it can be difficult to know what to spend the most money on. The main aspects to digital marketing go as follows, but there are more. Also this is presuming that you dedicate around 30% of your overall marketing budget to digital marketing.
- Search Engine Optimisation – Search engine optimisation often catches the majority of the digital marketing budget due to the fact that it takes a long time to get a website ranking well on google, and it is very obvious what the benefits of this are. The average spend of the overall digital marketing on SEO is around 40 – 50% and this trend will likely continue. This equates to around 14% of overall marketing spend on SEO alone. There is no way to instantly measure how much SEO is affecting your online presence quickly though, and if it is done badly then it can be time wasted.
- Mobile Marketing – Mobile marketing is the fastest growing digital marketing channel, and will capture around 10 – 20% of the total digital marketing budget. This equates to about 3 – 5% of the overall marketing budget. Mobile marketing is very effective for gaining the attention of consumers, as their mobile devices are with them always.
- Social Media – Social media is also another rapidly expanding source of investment; with around 10% of the digital marketing budget spend here although with time more may be spent on social media campaigns if they gain traction.
- Online display advertising (PPC) – this will take up the second biggest chunk of the digital marketing budget, sitting at around 34% of total marketing spend. This is also quite a good way to get guaranteed results as logically the more people see your brand then the wider known it will be, and the more traffic you will get, although it does not always scale if the people that see the advert are not the right sorts of people that are interested in your brand.
These statistics are based around B2C (Business to customer) companies, and it differs to a business to business standpoint.
Do I need to focus my efforts further afield?
If you are a small company and you want to grow with a smaller budget then it is advisable to stay very local. With a smaller budget it is very unlikely that at this stage you can compete with the bigger businesses, so don’t try and market anything towards any further out than your town/city and a few neighbouring towns at most until you start turning over more revenue to put into digital marketing. As they say, Rome was not built in a day, and neither was Google.
How should I approach my campaign?
Under no circumstances should you be dull. This seems painfully obvious however to new brands it may not be, they are often too focused on the performance of their products or services and they entirely focus on this. You need to create a natural buzz about your brand, Google favours brands with a lot of natural buzz, and the more people you can get to become interested in your brand through your marketing the further the word about your brand will spread.