Why your Business’ Marketing Budget needs to Increase this YearPublished on August 29, 2018
Statistics show that 49% of businesses are doing digital marketing. That’s not surprising at all, given the fact that this is one of the most affordable, and yet effective ways to boost their visibility, reach out to target audiences, build strong customer relationships and build a recognizable brand that stands out.
However, digital marketing is not all about sending a few emails, running a site, and opening social media accounts. To make the most out of it, you need to have a strong strategy and allocate your budget to it wisely.
Digital marketing is changing at an astonishing pace.
Digital marketing is changing tremendously. To stay relevant, you need to keep up with those changes and implement them quickly. Just take the link between trends like HTTPS, website responsiveness, or GDPR and your online presence as an example. Not complying with these trends may hurt your rankings and user experience, and even get you penalized.
Here are a few reasons why you need to consider increasing your digital marketing budget:
- The majority of your competitors are using at least some digital marketing strategies. For you, this means that you would miss out on an opportunity to keep pace with them and gain a competitive advantage.
- For your customers, your website, blog, social networks, and business reviews serve as a validation of your credibility and authority.
- Your customers’ demands have grown with the rise of artificial intelligence. This is why you need to invest in the right integrated tools that will provide your target audience with a smooth, personalized cross-channel user experience.
- Online channels will boost your brand visibility and help you reach out to wider audiences.
- Paid search helps you deliver a highly targeted user experience.
- With the help of the right digital marketing tools, you can boost your teams’ collaboration, give real-time customer feedback, and automate your repetitive marketing tasks.
How to allocate your resources properly?
To create an actionable and realistic marketing budget plan for your business, you need to take numerous tangible and intangible factors into consideration.
Here are a few steps you need to take.
Tailor your marketing budget to your financial health.
Before you invest in online marketing, you first assess your business’ financial health. This means working on effective debtor management, determining your income sources, as well as assessing fixed costs, variable costs, and one-time expenses.
Usually, businesses should devote about 20-30% of their budget to marketing. Of course, if this is too much for you, you can always team up with another business and participate in a co-op marketing program. Its benefits are multiple, for boosting your market reach to engaging your current customers more effectively.
What are your priorities?
In the world of marketing, new tools and their upgraded versions are appearing all the time. This is why you should always manage your expenses around what you would like to have versus what it is that you really need. Always check where your resources are being spent and compare them to the results you’re getting to see the effectiveness of your marketing strategy and alter it on the fly.
Keep hidden costs in mind.
If you’ve ever opened your bank report at the end of the month and scream: “Where did all my money go?” then you know what we’re talking about. This is why you need to take all aspects of your marketing campaign into consideration, from the tools you’re using, the costs of hiring an in-house team to content creation and customer communications.
Understand your brand.
No matter how ridiculous this may sound to you, one of the major mistakes small businesses make is not investing enough in their branding efforts. If you don’t have a clear and consistent brand image, tone, and voice, you won’t be able to build an effective marketing strategy around it and align your budget with your marketing goals.
Reassess your target audience.
When starting a business, we usually create a wrong picture of who our audience really is. So, if you’re still not sure who your products or services really attract, you need to conduct target audience segmentation.
With numerous social analytics tools, analyzing customers and listening to their discussions has never been simpler. This way, you will be able to invest in those strategies that resonate with your customers and the channels they use.
Have clear business goals.
There is no uniform marketing strategy. No matter if you’re investing in social media marketing or content marketing, you need to make sure that your actions really meet your business goals. For example, generating more leads and boosting conversion rates require investing in completely different marketing practices and channels.
How much to invest in digital marketing?
Your digital marketing budget depends on your budget, industry trends, and customer behavior estimations. Still, some of the most effective strategies you should invest in are search engine optimization, social media marketing, content creation and marketing, online video, and some additional techniques that may work for your brand.
According to a comprehensive research done by Adobe in collaboration with eMarketer, some of the major reasons why businesses increase their digital marketing budgets are:
- Improving your users’ experience.
- Creating compelling and highly personalized content.
- Building a data-driven and customer-centered marketing strategy that addresses each customer individually.
- Increasing brand engagement with video marketing.
- Cross-channel marketing that improves user experience.
Over to You
Digital marketing has become the backbone of your business. It gives you the opportunity to connect with the right people, through the right channels and, most importantly, build personal customer relationships based on trust and loyalty.
You just need to know how to allocate your marketing resources wisely. Observe your business’ financial health, have a clear strategy, understand your customers and, above all, test the effectiveness of your marketing practices and adapt your budget to these results.