6 Steps How To Allocate Budget For Digital Marketing

As you know, digital marketing is an umbrella term that encompasses all types of marketing activities that a brand performs digitally, both online and offline, to promote their services and products. Are you curious on how to allocate budget for digital marketing? Let’s read these articles for more information needed.

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List Your Goals

The first step before you can make b2b marketing budget allocation is list your goal first. Actually the main goal of every digital marketing plan is to increase sales, both in the tactical and strategic terms.

You can increase your business sales by running advertising campaigns, such as PPC or Facebook ads. Beside that if you want to grow your business, you will also need brand recognition and awareness too.

So if you want to increase Sales, you need to do these steps such as :

• Increase website traffic
• Improve conversion rate
• Retarget lost visitors
• Create a sales funnel

However if you want to increase your brand awareness, you need to focus on these parts, such as:

• Grow social media followers
• Engage more customers
• Get more content shares
• Increase ad impressions

By focusing on the mentioned part above, it will help to clear your goals and priorities. It also helps you to know how important digital marketing is for your business and how much marketing funnel budget allocation you are willing to spend on digital marketing.

Drill Down To The Details

The other steps on how to calculate digital marketing budget is by drilling down the details. You need to analyze each of your sub-goals or tasks and list the options you have to accomplish them. 

• If you want to increase website traffic, you can use SEO, PPC, Social Media, Email Marketing to help you with it.
• If you want to Increase conversion rate, you need to create new landing pages, revamp website, design a sales funnel
• If you want to increase social media followers, you can regular Updates, Boosted Posts, Viral Videos on your social media

This will help you to know the channels and activities that you can use for achieving your goals which help you to establish a budget for each digital channel

Select The Best Channels

If you want to make a sample digital marketing budget, you have to know what marketing agency you’re gonna use. Before you can choose your marketing agency, you need to do some market research to find out the most promising digital marketing channels and activities for your business. 

Here are three things you need to find out for a better preparations for your marketing strategies such as : 

• Competitor Research – Try to find which channels your competitors are spending most of their budgets on.
• Customer Discovery – You need to search where your customers like to spend their time whether they are reading blogs, watching video or looking at social media.
• Keyword Research – as you know, keywords are important. It will help the customer to find out your products easily.

Here’s the list of digital marketing channels and activities that you can choose from:

• Search Engine Optimisation (SEO)
• Conversion Rate Optimisation 
• Paid Search (PPC)
• Display Advertising
• Social Media (Facebook, LinkedIn, Twitter, Instagram, YouTube, Pinterest, and other networks)
• Email Marketing
• Content Marketing
• Mobile Marketing
• Video Marketing
• Press Releases

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Determine Cost Of Marketing Activities

After finding out the best marketing channels by looking at your past campaigns and/or through market research, now is the time to make the marketing budget allocation model. By making the budget, it will help you determine how many and which channels you can afford. 

What percentage of marketing budget should be digital? Before that, you have to do research and find out what is the average cost per click, how much are the agency costs if you’re targeting SEO? 

Besides, you need to have an idea about how much of each activity you will need to conduct in order to achieve your company’s goals and how many PPC campaigns or social media ads would your company need per week, month and year?

Estimate Your Budget

You might be curious on how to allocate marketing budgets across channels. Here are several methods of budgeting you need to know such as:

Affordable Method 

This is the simplest method of budgeting where you just need to estimate how much you can afford to spend on digital media. This method is really a good method for startups that are sticking their toe into digital media for the first time.

Percentage of Sales Method

You need to input your annual sales and you get a number for your annual digital marketing budget. Conventional wisdom will hint at 10% of sales as your total marketing budget. 

Competitive Parity Method

In this method you estimate what your competitors are investing in digital marketing and try to match that number.

Objective And Task Method

This is the most logical method of budgeting. In this method, you need to determine your objectives through in-depth market research and decide how much you need to spend in order to achieve those objectives. 

Measure Results

Your marketing budget is not set. You still can change the allocation of different activities or your overall budget depending on the response you are getting. Track your performance continuously and hold a monthly or quarterly review with your associates will really help you to budget for digital marketing.

Conclusion

Digital marketing is an umbrella term that encompasses all types of marketing activities that a brand performs digitally, both online and offline, to promote their services and products. Digital marketing will help you to achieve your business goals. You can find a great digital agency to help you with it. You might worry about the money that you need to pay when doing digital marketing.

But you don’t need to worry. Follow the steps on how to allocate a budget for digital marketing as mentioned above such as list your goals,drill down to the details, select the best channels, determine cost of marketing activities, estimate your budget and measure results.

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