When you begin allocating your 2021 marketing budget, it’s no secret that you’ll want to incorporate digital media. With the world relying more on the Internet each year, marketers have found that digital marketing has been a foundation for their company’s success, especially in response to the global pandemic. Because of this, traditional marketing is beginning to take a more distributed approach, allocating a part of regular marketing budgets towards solely digital marketing. In this blog, we will teach you how to create a realistic and effective digital marketing budget allocation that will set you and your company up for success.
Read more about the impact of new media here.
Setting a realistic budget
To set a realistic marketing budget, be as specific, organized, and prepared as possible. Before you start allocating your digital marketing budget, begin with setting your core company strategy. If you have a concrete strategy, you will be able to easily align your marketing strategy with your company’s goals.
Once you begin creating your marketing strategy, list your main marketing channels, and potential sub activities within those channels (i.e. video marketing, Instagram Reels marketing). The most common channels within digital marketing include email marketing, social media marketing, content marketing, and SEO.
After you have established your desired marketing channels, organize your company’s financial information. Your budget will obviously depend on your company’s finances, but it’s recommended that the marketing budget falls somewhere between 7% - 15% of your total revenue. Once you have the amount of disposable income that you are able to use, it’s time to start budgeting! Remember to set a portion aside for unexpected costs.
When you begin your digital marketing budget allocation, it’s important to remember which audience you are targeting, and your goals for how you want to acquire new customers. Begin allocating the budget towards tactics that have proven successful for your company in the past. Always set a portion aside for trying out new tactics and strategies that look promising.
Set clear goals
Setting clear and achievable goals for your digital marketing budget is required for measuring the performance and success of your chosen marketing tactics. Because your marketing goals should align with your company strategy, your marketing successes will directly contribute towards increased sales and brand awareness.
Focus on creating goals that follow the SMART framework: Specific, Measurable, Achievable, Relevant, Time Bound. There are countless examples of measurements and goals when it comes to digital marketing, here are some of the most popular and effective metrics:
- Improving Conversion Rates: This poses the question, how do we convert site viewers/followers/listeners into actual customers? How do we retain those customers? Setting a quarterly conversion rate goal and establishing tactics that will help achieve this goal is a great place to start.
- Increase Sales: This is a great top-level performance metric for digital marketing strategy because it targets your overall sales revenue, and is easily trackable.
- Organic Traffic Volumes, Rank Higher in Search Results: This tracks natural traffic to your site’s pages via search engine results. Making strategic changes to your website using SEO is a tactic you can use to improve organic traffic volumes.
- Increase Brand Engagement: There are a variety of KPIs that measure engagement. If you want to increase social media engagement you can track the number of comments and followers you receive per month and set goals accordingly. You can also aim to increase reading retention time on your site.
- Increase Brand Awareness: You can measure brand awareness through conversion rates, traffic volumes, and engagement. Creating brand awareness tactics involves thorough content planning and digital marketing strategies.
Create a list of marketing platforms to live on
If you’ve spent some time on the internet, you’ll know there are a number of platforms that are readily available for you to promote and digitally market your company. The best news is, there is not one that is objectively better than the rest! Depending on what your digital marketing strategy is, each platform offers unique ways to promote your content. Here are some of the most popular, including the expected costs and potential ROI for each:
- Instagram: Instagram ads have the highest digital engagement rate out of any other platform, which is what makes Instagram as a marketing platform so attractive. Instagram ad campaigns cost on average anywhere between $0.20 and $2.00 per click depending on your industry. Instagram has a relatively high average conversion rate per post (3.1%) compared to other platforms, this means that Instagram ads can yield a higher ROI.
- Facebook: While Instagram increases engagement, Facebook is best at increasing reach. Facebook marketing has proven to be effective for its advertisers, with average costs at $0.97 per click, or $7.19 per 1000 impressions. With an average conversion rate of 4.7%, there is potential for a high ROI with Facebook advertising. In addition, Facebook’s Ad Manager platform makes it easy for relative newbies at marketing to get stuck in and drive results.
- Twitter: Like any platform, the cost of advertising on Twitter depends on what you are promoting. On Twitter you have the choice to promote a post, a trend, or your profile. Promoting a tweet is the most popular, and average costs fall between $0.50 to $2.00 per action dependent on industry. The platform has a lower average conversion rate of 0.5%, this could be due to the lack of reach Twitter offers compared to other platforms. Optimizing your tweets has proven to be an effective way around this roadblock.
- Pinterest: Pinterest has become one of the most effective visual-search engines on the internet, making it a great place for businesses with visual aspects to market their product or service. With Pinterest ad campaigns you can choose to either promote based on brand awareness, engagement, or driving web traffic. A popular goal for Pinterest ads is to increase brand awareness, with the average cost between $2 - $5 per 1000 impressions. For a lower price compared to other platforms, it is worth it to invest a few dollars towards promoting pins. Pinterest ads have a conversion rate of 0.54%, but this will likely increase as the platform allows advertisers to connect with customers in creative ways.
- LinkedIn: Marketing on LinkedIn is a great way to generate leads, website traffic, and brand awareness while fostering relationships with other professionals and businesses related to your industry. LinkedIn campaigns primarily focus on CPC and CPM performance. Businesses on average pay around $5 per click, or $7 per 1000 impressions. LinkedIn marketing also offers InMail campaigns, which sends information directly to leads in their LinkedIn mailbox. To make LinkedIn campaigns worth it, marketers suggest that it is best to create non-sales driven content and be sure to optimize your profile before starting.
Monitor and adjust
Once you have set your strategy, budget, and chosen your digital marketing platforms, it’s time to monitor and adjust your tactics accordingly. Monitoring your marketing tactics is most effective when you have identified clear goals, set KPIs, and identified specific target segments.
Use your chosen digital marketing platform to monitor what others are saying about the trend or post you are promoting. The KPIs you choose to measure will help you monitor your campaign or strategy’s success over time. Specific KPIs can also help illuminate any weaknesses your marketing strategy might have. Using that information you can account for or eliminate those weaknesses to help reach your goals.
Set a plan for how you will monitor your strategy by identifying which digital marketing tools you will use to monitor your platforms. If you’re confused on which tool is best, Cohley is a great place to start. We offer a variety of content tracking and analytics tools that make monitoring performance simple.
The components to include in your new media budget
You’ve established how much disposable income you can allocate to your digital marketing budget, and you’ve set your strategy and tactics. But where is that money specifically going to be spent? Make sure you include a breakdown of spending with these components in your new budget:
- Technology: What is the cost of the tools and software you will be using to market your service? Photo editing software, keyword tracking, and project management tools can also fall under this category. Basically, any external resource you use to drive your marketing successes is included!
- Content: Your content is what you share with the world and how you present your brand, so you’ll want to allocate some time and money to make sure it is perfect! Depending on your service and your chosen marketing platform, different sub-categories for content can range from video, photography, copywriting, actors or extras, and other external production costs.
- Ad spend vs ROI: The goal of every marketing campaign should be to generate a positive return on ad spend. Your return on ad spend is what you use to determine how to spend your advertising budget in the future, and to determine whether a specific campaign was successful. Return on investment (ROI) is a great key indicator for overall gains and losses in revenue, but it does not track specific campaigns.
- Training: In the era of digital marketing, technology and tactics are constantly changing which means you and your employees need to stay up to date with all of the latest information. Investing in online training programs for your company is a perfect way to develop your team’s skills for specific needs, while also encouraging employees to stay involved in the learning process.
- Measurement: As always, account for any performance tracking and measurement tools in the budget that allow you to analyze campaigns with ease.
Conclusion
It’s a fact, it’s time to start allocating a portion of your budget for digital marketing! The Internet is expanding at a rapid pace, and you don’t want to be left behind. With Cohley, we help you get ahead of the competition by generating diverse assets, leading strategic and effective campaigns, and creating comprehensive performance metrics to make sure your brand ends up on top. If you want to create a successful data-driven brand with top-of-the-line content, contact us to learn more about how Cohley can help you do that and more.
