When it comes to getting the word out about your business, you probably know you need to invest some resources into it, but do you know how much? How do you set a realistic marketing budget for your company? What factors do you need to consider for each tactic your business employs?
Today’s post is the first in a series of three that will answer these questions for you. Ultimately, a successful marketing budget and strategy for your company may be different than another business’, which is why it’s important to walk through the steps of what to consider as you develop plans and set aside funds to make them a reality.
Why Invest in Content Marketing?
When we advise clients in regards to their budget, we recommend content marketing as a fantastic long-term strategy to build your brand, increase your online visibility and establish positive relationships with consumers.
Both B2B and B2C companies are following this trend, too. As this infographic shares:
- 91 percent of B2B marketers are using content marketing
- 86 percent of B2C marketers are using content marketing
- Nearly 80 percent of B2C marketers report they can demonstrate how content marketing has increased audience engagement
- More than 70 percent of B2B marketers report they can demonstrate how content marketing has increased audience engagement and their number of leads
- 60 percent of B2C marketers report their organizations are extremely or very committed to content marketing
Establishing Your Content Marketing Budget: An Overview
When wondering how much of your annual gross revenue should go towards your marketing budget, a good rule of thumb is about 10 percent.
But establishing a realistic budget takes more than just knowing you plan to use about 10 percent of your annual gross revenue. How much of it will you spend on social media, blogging or email marketing? What about advertising – are you factoring in how much the various platforms charge for ads? You might want to consider other content marketing tactics like creating infographics or guest blogging, too.
Popular Content Marketing Tactics
Here are seven popular tactics you may want to consider building into your overall marketing budget:
- Social Media Advertising
- Organic Social Media Marketing
- Blogging for SEO (Search Engine Optimization)
- Email Marketing
- Infographic Creation and Promotion
- Guest Blogging
As you consider which tactics you want to use and how much of your marketing budget to allocate towards each item, consider your goals and your timeline. How soon do you expect to see results?
For example, blogging is a slow and steady approach that takes time. If you consistently write and publish posts following SEO best practices, you’ll likely start to see your internet traffic increase over the next 18-24 months, but it’s not an overnight strategy.
If you want faster results, on the other hand, you can run a social media advertising campaign. But consider that your visibility will be directly tied to how much you can invest in the ad spend, or the actual ad views. If you decide to spend $100 per day, you’re going to see very different results than if you set the cap at $20 per day.
At Three Girls, we recommend a multi-pronged approach to spending your marketing budget. Even with limited funds, you can see positive results from your marketing efforts by strategically choosing the areas you want to focus on and being consistent with them. For example, if your budget doesn’t allow for all seven tactics above, consider starting with three or four of them. Ideally, over time your company’s revenue will grow, which means your marketing budget will increase as well.
How Will You Spend Your Marketing Budget?
It’s important to consider logistics when it comes to your marketing budget. Will you put in the time to execute the tactics yourself, hire an employee, outsource the work to a firm, or some combination of the three?
1. Doing It Yourself
If funds are tight, I know there’s a strong pull to take on your company’s marketing yourself. Still, before you put in the time and energy to figure out what you’re doing and how to do it, consider how much your time is worth. Do you realistically have time in your schedule to commit to executing marketing activities and doing it well? Content marketing is an effective strategy, but consistency and quality are two important factors you may not be able to deliver if you’re stretched too thin.
2. Hiring an Employee
A lot of companies want to keep their marketing in-house as it allows for their team to really get to know the business intimately. Depending on internal communication practices, it can be easier to keep everyone informed, too.
While this can produce positive results, if you’re considering the impact it will have on your budget you need to think beyond payroll. How much will it cost to train a team member, and for them to keep up with industry trends and best practices? What about employment benefits, fees and insurance costs? Remember you’d also be responsible to pay out unemployment should their position at your company change.
3. Outsourcing to a Marketing Firm
While working with an external firm can have its challenges, especially in regards to keeping them informed about your business’ initiatives, events and products/services, it comes with its benefits too. They likely have experience working with all sorts of companies, meaning they may have ideas and approaches they’ve seen work time and again that they could apply to your business. Also, many agencies encourage ongoing learning for their staff, which means they’re staying up-to-date regarding content marketing best practices and trends they can apply to your organization.
It’s important you take the time to research a content marketing agency that’s the best fit for your brand. Ask them questions to clarify what exactly they’ll provide, what your responsibilities would be and how your ongoing relationship will work.
4. Combining the Options
It’s not uncommon for companies to develop some sort of hybrid approach based on their marketing budget and available staff.
For example, you may have a marketing manager on-staff at your business, but want to invest in more content marketing then they can manage on their own; by outsourcing some of the work to an outside firm, your manager can oversee progress and answer questions about the brand while still having time to oversee other marketing initiatives.
As you can tell, there are a lot of factors to think about in regards to your marketing budget. When it comes to dividing your overall funds between various tactics, it’s helpful to understand everything that goes into each activity.
Marketing Budget Considerations: Social Media Advertising
Social media advertising is one of the most popular marketing tactics right now. As various platforms’ algorithms change, many brands see advertising as a reliable way to put your message in front of target consumers.
As you consider your marketing budget, think about the social media channels on which you want to focus your advertising efforts. Of course, the top consideration is: where is your target audience? It’s not worth spending the money advertising on a platform the people you’re trying to reach don’t use.
Marketing Budget Factor: Cost Per Click
It’s also important to consider the cost of running ads on each platform. While all of them allow you to set a budget of how much you want to spend per day, the average cost per click (CPC) varies between the different social media sites.
Some of the platforms have quite a range, with a variety of factors coming into play such as the amount of competition between your ads and another brand’s ads, demographics of whom you’re trying to reach, days of the week, times of day, etc.
- Facebook: $o.45 – $3.77 per click
- Instagram: $0.70 – $2.59 per click
- LinkedIn: $5.67 – $6.50 per click
- Twitter: $0.52 – $0.80 per click
As you can see, just between the four social platforms above, there’s quite a difference between a click on Twitter and a click on LinkedIn. As you think about which networks you plan to advertise on, consider how much you’ll need to set aside for the ad spend itself.
Marketing Budget Factor: Number of Ads
Once you’ve decided how much of your marketing budget to allocate towards social media advertising, you can break it down by month, week and day to determine how many ads you’re actually going to run.
We like to recommend you run more ads up front at a lower CPC so you can do some A/B testing. Run two nearly identical ads at the same time, with one differing factor. This can give you really valuable information about what resonates with your audience, such as type of image, type of ad, tone of the copy, etc.
Once you do initial testing up front, you can decrease the number of ads and put more money behind more strategic advertisements that are likely to perform well based on your testing. If you have the budget for it, you may also want to consider running retargeting ads, which target users that already responded to your previous advertisements.
In addition to the cost of actually running the ads, remember it takes time and resources to create ads. In addition to developing the actual ad copy (or text), you need to consider visuals you’ll run with it. Will you use an image or video? Are they ones you already have or do you need to invest in stock photos and/or video creation? Some platforms (like Facebook) have a wide range of types of ads you can create, from a single image or video to carousels with multiple images, so keep that in mind too.
Also, where will you direct the consumers you’re trying to target? Is there already an existing page on your website where you want them to go, or will you build a landing page to convert those that click through into sales leads? And will you build multiple landing pages to test out which perform best?
At Three Girls, we always recommend a landing page to provide a strong call to action and encourage your visitors to take the next step, such as giving you their contact information. This, however, is another step in the advertising process that will take time and resources to set up.
Next Steps for Your Marketing Budget
As you can see, there are a lot of factors that go into creating a successful plan and marketing budget for your business. In next week’s post I’ll share additional criteria to consider in regards to tactics like organic social media marketing, blogging for SEO and email marketing.