Digital Marketing Budget – How Much Should You Spend?
Digital marketing and online customer acquisition have become some of the most important ways to make conversions. Business is done online all the time now and that’s the direction marketing is trending as well so it’s imperative to adapt and grow with the consumers. Digital marketing can be intimidating for businesses that aren’t sure how to budget for it. The good news is that you don’t need to spend a fortune to be successful. SearchEngine Watch published an article in March detailing how to budget an online advertising plan. The article highlights the important questions that need to be asked before a plan is implemented. Some of these questions are:
- What do I want out of my campaigns?
- How many conversions can I reasonably expect to get from my campaigns?
- Is search advertising my only growth channel right now, or are there others?
- How much will I also be putting into SEO or email?
- How can I track my search advertising to make sure my performance is what I expect?
- What will success look like?
“Your budget is going to reflect what you want out of your campaigns, and what you want should reflect what growth looks like to your business. All of it matters, because your approach to your search advertising, and consequently your budgeting, will be determined by your goals.“Source: SearchEngine Watch
Identifying a business’s needs is the first step in planning a budget for an online advertising campaign. It is essential to be honest with how much you have to spend and how much makes sense to spend. It is imperative to set clear cut goals. There needs to be a monthly rate of growth or some quantifiable objective that can be measured and reached for. An example of a quantifiable goal is:
“You need four conversions a month to hit your $2,000 goal. You convert five percent of the leads you get. Four is 5% of 80. You, therefore, need 80 leads per month to reach your goal. And if you pay $10 per lead, then your budget should be $800 a month for search advertising. Now, that’s an ideal situation. That’s assuming you can make it all happen consistently like that, month after month. In the perfect world, that budget will indeed be ROI-worthy.“Source: SearchEngine Watch
It’s key to understand what your conversion rate needs to be so that you can budget your advertisement plan properly. In addition to knowing your conversion rate and the numbers needed, bidding on the right keyword searches can be just as important. In case you didn’t know, it works like this in search engine optimization (SEO), too: the more mainstream, general, and competitive keywords – such as “SEO company” – are going to be more expensive to bid on. Depending on your budget, you may not be able to sustain that kind of campaign for long, and it’s going to end up as a lot of wasted dollars. A more affordable strategy to target keywords is:
“A longer-tail keyword such as “SEO agency for link building” will cost you less and have fewer monthly searches. But as in any sales funnel, when searchers get more specific, they tend to be more ready to convert.
Just remember that when you get more specific, you’re going to want to hone in on the quality and relevance of your ads’ corresponding landing pages.Source: SearchEngine Watch
A long-tail keyword search requires a long-tail ad, and a long-tail ad requires a long-tail landing page (so to speak). Be sure to deliver on what your ad promises. Surely, you can develop content related to hiring an SEO agency for link building.“
In summary, when making an online advertising budget it is essential to understand what your goals are, what your conversion rate is, and how to bid on keyword searches that are right for your business.