With the number of digital marketing techniques currently available to businesses, it can be tempting to spread your budget thin by launching campaigns through every channel. However, true success comes when marketers take a strategic approach to allocating their budget to ensure funds are spent properly.
While it’s helpful to diversify your marketing strategy and try different approaches, running campaigns on too many platforms can lead to less-than-stellar results. Instead, you should focus on investing in a few key areas and executing them well. If you want to see a better return on investment (ROI) for your digital marketing efforts, here are a few tips for allocating – and maximizing – your budget to make sure each dollar is well spent.
1. Set goals
The goals you identify with your team provide a roadmap to guide subsequent budgeting decisions. Your digital marketing goals should be a reflection of your company’s priorities and, without them, there is no framework for allocating funds.
Some common goals marketers may set include increasing brand awareness, generating leads, improving social media engagement, converting first-time buyers, and retaining repeat customers. Your overall goals will likely change as your business grows; however, setting those goals is critical to deciding where to invest.
2. Conduct research
Once you’ve set your goals, you can delve into researching the digital marketing landscape within your industry and gaining insights into trending or tried-and-true campaigns. According to an article from the Huffington Post, a few important areas to include in your requisite research for allocating funds include:
- Analysis of how and where competitors are investing
- Effective keywords themes or groupings for search engine optimization (SEO)
- Social communities and identifying which channels your audience is frequenting
- Social influencers and how much it costs to work with them
- Costs for creating and producing content
- Your email database and opportunities for distributing via that channel
3. Analyze prior campaigns
As part of your research, you should review past digital marketing campaigns to evaluate where you have already spent marketing dollars and the outcome. By analyzing prior campaigns, you can identify tactics or techniques that didn’t convert leads, generate sales, or accomplish other goals. This step also helps you recognize under-supported channels or instances when campaign goals were met or exceeded.
4. Assess your budget
Next, calculate your digital marketing budget and determine what you realistically have to spend on various campaigns. It’s better to establish at least rough numbers up front rather than launching a campaign only to discover it may cost more than you can afford.
Different companies may have – and need – more money to spend on digital marketing. How much you should spend in this area depends on numerous factors, such as your current revenues and expenses; startup funding; current rate of growth; competition; and business objectives.
5. Allocate digital marketing funds
Now that you’ve done your research, analyzed past campaigns, and established a budget, you can begin allocating funds across digital marketing channels and tactics. You can start by listing the channels available to you, which may include display advertising, content marketing, website optimization, paid search, and social media marketing.
Keeping your goals in mind, select the channels that will be most instrumental in helping your company succeed. Use your research and empirical evidence to guide the decision-making process, and keep in mind it’s better to invest well into a few effective channels, rather than investing a little into all of them.
6. Measure campaign performance
Your job isn’t over after you’ve invested. Once you’ve launched a campaign, you should track its success on an ongoing basis in addition to more formal check-ins and evaluations throughout the year. Actively tracking and evaluating your digital marketing campaigns allows you to manage them carefully, improve their performance, and identify whether they’re paying off in the end.
Establishing a solid digital marketing budget
It’s common business knowledge you have to spend money to make money. The same is true for advertising and marketing. You will inevitably have to invest funds into these areas if you want your company to experience growth. However, it’s also important to be strategic to ensure your money is well spent. Following these steps, you can set you and your team up for effectively allocating your budget and tackling digital marketing campaigns in the optimal channels.