Developing a Digital Marketing Budget
Digital marketing is necessary if you want your brand and business to be noticed and stand out from the competition. Since digital marketing is a must-have, spending money on it is a given. Creating a budget is crucial for making sure that you don’t spend too much and know exactly where your money is going.
Throwing money into digital marketing without a plan can end in overspending as well as undesirable results. Once you’ve determined exactly how much you have to spend on digital marketing, you can begin the process of creating a detailed budget.
Here are some things to think about when developing a digital marketing budget:
Know Your Digital Marketing Goals
Before you begin allocating money into a digital marketing strategy, you need to know your company’s marketing goals. Your digital marketing goals may include:
- Brand awareness
- Better/increased leads
- New customer acquisition
- Increased revenue
- Engage customers and potential customers
Digital marketing goals are more than just generating sales. There are various areas that digital marketing can benefit and you want to consider them all before throwing your entire budget into just one goal.
Analyze Current Digital Marketing Strategies
If you’re in the process of creating a digital marketing budget, you’ll want to analyze the results of any current digital marketing strategies that you have. Finding out whether they have been effective or not will allow you to decide whether or not to keep them in your new strategy and digital marketing budget. If a strategy has not paid off in recent months or years, there is no reason to continue spending money on it. As you analyze your digital marketing efforts, you can yourself these questions:
- Which digital marketing strategies positively impacted the bottom line?
- Which strategies performed poorly?
- Can a strategy be improved for performance?
You don’t want to keep spending money on activities that aren’t working. As you create your new budget, you can allocate money to trying a new strategy. A lot of digital marketing can be guesswork until you’ve had the opportunity to test it out. Once you know something doesn’t work, cut it loose.
Understand the Sales Funnel
As someone in charge of a business, knowing how the sales funnel works is key to digital marketing success. A good digital marketing strategy will target each stage of the sales cycle. Budgeting for each stage is crucial to ensure that you aren’t appealing to only one segment of your target audience. The stages of a sales funnel include:
- Awareness
- Interest/discovery
- Decision
- Purchase
- Repurchase
Your digital marketing efforts need to move each potential customer and customer on to the next stage. Budgeting appropriately will help you achieve this.
Repercussions of Not Budgeting
By not budgeting, or miscalculating, for your digital marketing, you run the risk of overspending. If you neglect to analyze by reviewing previous years as well as quarterly results, you are likely to budget money into activities that won’t provide a return on your investment. By not budgeting, you also risk not hitting your business’s financial goals because they all work together. A bad or non-existent digital marketing budget will have a ripple effect throughout your business. If people aren’t noticing your brand, they won’t be driven to your website to make purchases.
Digital marketing plays an integral role in the overall success of your business. Make sure you’re budgeting correctly to align with your business goals and objectives.
Categorized in: Digital Marketing
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