Figuring out the exact budget for your digital marketing efforts involves precision. To put it precisely, it is a mix of art and science. Spending too low is as bad as spending too high. Spending too much has some dangerous consequences, as you would be forced to lower your budget in other marketing efforts thereby limiting the scope of marketing. Having highlighted all these, what would be the ideal digital marketing spend? It’s impossible to decipher the most appropriate budget cost without taking into consideration the various objectives that a business intends to achieve through digital marketing.
A statistical glance
Digital marketing spend is expected to increase at a rate of 35% by the year 2019. In the year 2016, almost all companies allocated 30% of its marketing budget to the online medium. In the years to come, it is search engine marketing that will be attracting maximum investment followed by online display advertising. According to Forrester research report, investment in social media is going to be massive.
Through the research findings published in eMarketer, investment in Google AdWords is going to increase tremendously than any other digital marketing services platform in the next 12 months. Investment in Facebook is expected to increase to the tune of 69% compared to the investment to be made on Instagram and Twitter which is 41% and 21% respectively.
It can be inferred that only businesses intending to drive sales through digital medium invest heavily in digital marketing.
Below is the percentage of increase in marketing spend across all digital marketing platforms
- Social Media – 56.3%
- Online Display Advertising – 55.9%
- Email Marketing – 59.7%
- Search – 42.4%
- Mobile Marketing – 51.9%
How to calculate the right digital marketing budget?
Define the goals precisely
Businesses need to be very clear in the objectives and goals that are to be attained from digital marketing efforts. Whether to acquire leads, increase sales or to build brand awareness? Depending on the goals, the online marketing strategy has to be evolved. It is the end marketing goals, that is going to define the kind of marketing campaign. Furthermore, companies should keep a tab on the latest digital marketing trends so as to invest in the right digital marketing platform.
Get an inference from the well-performed strategy
Businesses should study the previous year’s numbers and decipher the best-performed marketing strategy. The foremost objective is to identify the digital marketing technique that yielded greater ROI and those that underperformed. This analysis can give an inference on the audience’s preference. It is better the analyze the number of email subscribers, leads garnered, sales, shares, and retweets before taking a final call on the marketing budget.
Invest in new techniques and strategies
Though the business would have tasted success by implementing certain marketing techniques, it is highly critical to allocate a certain portion of the marketing budget towards experimentation. By experimenting new techniques, businesses get to know some brand new strategies that would work for the business.
Monitor the trends in industry
Analyze your competitors’ strategy and gain valuable insights from it. It is most likely that the strategies through which they are reaping benefits might work well for you too. Figure out the ways on how best you can incorporate the strategy into your business. At the first level, don’t invest big bucks. It is better to adopt a wait-and-watch approach.
Want a clear picture on the prospective digital marketing budget that your business should spend?