Another calendar year is coming up, and 2021 is winding down. For those of you business owners with a marketing plan, congratulations, you're already ahead of the curve. But now isn't the time to let up. The end of a year is the perfect time to look over your numbers from last year and adjust your plan for the next. Let's go over the basics for setting up next year's marketing plan.
Start by Setting Up A Marketing Budget
One of the most essential parts of any marketing plan is knowing your numbers. It is crucial that you track how much you spend on each type of marketing in which your business engages. That way, you will have an accurate way to tell where your money is most effective. You will want to know both your total ad spend as well as your ROI (return on investment).
If you don't yet have a way of determining which marketing campaigns are bringing you business, the start of a new year is a great time to start. One of the easiest ways to figure out your ROI is to offer a survey to your customers that asks how they heard about your business. For digital campaigns, this is usually even easier as the services you use will track your campaigns for you.
When you're armed with detailed information on your expenditures, you will be able to make informed decisions about your resource allocation in the coming year. One of the best ways to determine where to spend your money in a new budget is to compare the ROIs between your various marketing forms. Once you've decided how much you would like to spend, you can decide how to allocate funds between marketing formats.
How to Balance Between Traditional and Digital Marketing
There are many factors that will help you determine how to allocate your marketing budget, and we will discuss some of these below. The broadest level that you will divide your budget at is between 'traditional' and 'digital' marketing. So, before we get started, let's go over what each of these categories encompasses.
What's the difference between traditional marketing and digital marketing?
Generally speaking, traditional marketing refers to the set of advertising options available to businesses before the internet. Traditional marketing includes direct mail, radio, TV, and print ads. While it may seem counter-intuitive, these mediums for promoting your brand have not been rendered ineffective by the internet, but the internet has changed how they are used and which ones are most effective.
Digital marketing is the new kid on the block. There are several types of digital marketing: search engine optimization, pay-per-click, social media marketing, content marketing, email marketing, and mobile marketing. Each of these forms will have varying usefulness in different stages of the buyer's journey.
Dividing Your Marketing Budget Between Traditional and Digital Marketing
Now that we've discussed the key differences between digital and traditional marketing, we can continue the discussion of how to divide a marketing budget. At Zimmer Marketing, we recommend a budget split of about 30% digital and 70% traditional. One of the biggest reasons we recommend this split to our clients is the ROI of traditional marketing, particularly radio. Radio consistently outperforms even other types of traditional marketing such as TV.
Another reason that we recommend a heavier emphasis on traditional marketing is because of the importance of achieving 'dominant frequency.' Dominant frequency is an essential part of the marketing system we use here, Chuck Mefford's BrandsFormation. In BrandsFormation, dominant frequency refers to the number of spots it takes to dominate a particular marketing medium. For instance, BrandsFormation has a 21 52 plan for radio. That's because it takes running an ad three times a day, seven days a week, for a year to 'dominate' the station(s) you are marketing on.
Achieving dominant frequency through a cost-effective traditional marketing channel like radio frees up the remainder of your budget for effective use in digital. Digital marketing forms such as banner ads are often most effectively used when someone is close to buying. For example, with banner ads and most other forms of digital advertising, you can choose who will see your ads. A good group to target would be someone who has recently searched for a product your business offers.
Here's how it works: Suppose you own a plumbing business and spend 70% of your marketing budget on traditional. By doing this, you have generated brand awareness around your local community, with about 80,000 people reached. Now, most people do not need a plumber every day or even every year. However, when a new customer has a pipe burst, they will already recognize and have a favorable view of your business. When that new customer goes online to find a plumber, they will either encounter one of your digital ads or else navigate directly to your website. That's how traditional and digital marketing work best, and that's how to put together a marketing plan that will deliver results.