Are You Allocating Your Marketing Budget Wisely?
Your marketing budget probably depends on a number of things. Your industry, the size of your business, how successful your marketing was in the past, and how saturated your market. There's no one size fits all rule for how big a marketing budget should be, but understanding what the competition is investing is important. According to a recent CMO survey, marketers are planning huge spending increases but understand that their organizations lack the skill sets to make the most of these investments. What does that mean? Brands just like yours are recognizing the need for more marketing support from outside specialists. As you finalize your 2018 budget, are you following suit?
Since every business is unique there isn’t a magic formula that will tell you how to spend every last dollar of your marketing budget to generate the most results. Beyond analyzing which strategies yielded the most results at the highest ROI, there are consumer trends that need to be observed before allocating your marketing budget.
According to a study by globalwebindex, daily internet usage is reportedly approximately 6 hours a day versus 4 hours a day usage of traditional media (TV, Radio, Print). What are people doing with that time? Well Google gets over 100 billion searches a month, 72% of adult internet users use Facebook , and 81% of shoppers are conducting online research before making big purchases.
Those numbers illustrate the importance of allocating a significant portion of your marketing budget to online initiatives. Brands just like yours are recognizing the opportunities that come with integrating online marketing initiatives with offline strategies. They are investing more money online. Is you brand keeping up?
Let's break it down...
According to eMarketer only 32% of total advertising spend is on digital. Television alone surpasses that number with 38% of advertising spend devoted to TV. The other 30% goes to Print, Radio and Outdoor.
A study by the Duke University Fuqua School of Business reports that the average business spends 9.4% of its marketing budget on social media (B2C product businesses spend 16.3%). Where is that money going? eMarketer reports that total ad spend on the social media channels was $32.97 billion last year. Marketers planned to buy social media software more than any other type of marketing technology in 2017. Hiring an outside agency or new employee to manage social media efforts is an added expense.
The Content Marketing Institute reports that on average, brands are spending approximately 32% of their total marketing budget (not including staff) on content marketing. That's up from 25% the year prior with 50% of those brands planning to increase the content marketing budget further in the next 12 months.
Typically built into other areas of online marketing plans today, it may be rare to find SEO as a line item on a marketing budget in 2018. That doesn't mean it shouldn't be budgeted for. As the foundation of any successful online marketing plan, SEO deserves its fair share of your budget. A survey from Moz reports that the average monthly billing for most SEO providers is over $1,000.
When you're planning your marketing budget, be sure to incorporate all of the pieces to set your brand up for success in 2018. Working with the right online marketing agency will help, but it's up to your brand to prioritize your marketing initiatives and allocate enough budget to pull away from the pack and lengthen the gap between your brand and the competition.
What's holding you back?
People fear change. In a Forbes article, Andrea Simon notes these three reasons why many CEOs resist change.
- Afraid of the unknown
- Driven by well-honed habits
- Convinced the past will reappear and save them
While it’s easy to continue on the same path you took to become a successful business, it can also be very costly in the long run. As technology changes, business needs to change, and that means targeting consumers where they reside most (online) and integrating your online initiatives with your offline marketing for a stronger, more cohesive brand voice.
Simon offers some advice to opening the door to change. "…if you truly want to see, feel and think in new ways, you have to fight your brain’s desire to stay put. To ignite change, you need to do it yourself first. You need to recognize that new ideas come from trying new solutions in your own head and changing your brain’s focus. Then you can roll out the rest of the plan to your company."
Now is the time to budget wisely and allocate well. An integrated marketing program with enough budget for a competitive digital strategy will set your brand apart from the competition. For more information on what the right digital strategy looks like for your brand, let's talk!