Your marketing budget: Are you investing in the right areas?
This means prioritising different areas of your marketing strategy, but how do you make that call? What if producing high-quality content means sacrificing paid advertising on a social media channel that’s worth investing in?
It’s difficult, because arguments can be made for both (though we’d never suggest scrimping on content quality, that’s a big no-no). It really depends on your businesses’ priorities … but that often doesn’t make the choice any easier.
We’re not the only ones who’ve been thinking about this. Greenlight recently commissioned a survey of 200 marketing professionals in a bid to understand how digital marketers are spending and tracking their budgets in 2017.
We’ve looked at its findings and thrown in some of our own ideas, so you can determine if you’re using your marketing budget effectively, or if you need to make some improvements.
What should your marketing budget cover?
Your marketing budget has to go a long way. So much so that we could write an entire blog on the subject! However, that’s not why we’re here today, so here are the key marketing budget areas:
- Content creation for all channels – Blog, website, social media, email campaigns, white papers, guides, leaflets, brochures, video etc
- Content distribution – Social media, third-party sites, advertising campaigns, email etc.
- Helpful add-ons – PPC, AdWords, SEO, CRO, audience targeting etc.
- Tools and platforms – From social media scheduling tools, to user analytics and beyond
- Outsourcing – Copywriters, graphic designers, web developers etc.
In some cases, you might need to include your salary here too!
So, your marketing budget covers a lot, but some areas are more essential than others. Have a think about your businesses’ needs and which areas you might need to increase, or cut down on.
Do you really need a hefty marketing budget?
It’s easy to underspend on marketing, but it’s also possible to spend too much.
The important thing to remember is that your marketing budget must be appropriate for your business, and sustainable. That’s why small businesses often allocate between 7% and 12% of their total revenue to marketing.
You see? Marketing doesn’t need to cost the earth, even if you want to compete with the big players.
A good content marketing strategy can be executed on a modest budget. You just need to be organised, have a strong plan, clear direction, excellent content and an extensive distribution network. (Don’t worry, you can build up to that last one.)
How do marketers spend their budgets?
So, we’ve looked at what a marketing budget is, now we’re going to look at how modern marketers spend it.
According to the Greenlight survey, marketers aren’t sure that they’re spending their marketing budgets effectively (but that doesn’t stop them from spending)!
35% of marketers spend most of their marketing budget on social media. When you consider that only 23% of customers like being targeted on social media, you’ve got to ask yourself – is this worth it?
You can run social media campaigns for free and still make an impact, so perhaps cutting down on this spend could be helpful.
21% of marketers dedicate most of their budget to content marketing. That’s great news! This can be a huge boost for your business, even though it may take a while to feel the effects.
However, ‘content marketing’ covers many content forms and disciplines, so it can often be hard to establish if it’s an effective use of marketing budget.
The study also found that 36% of marketers don’t have confidence in their campaign targeting. A massive 18% don’t believe they’re reaching their desired audience at all! This is surprising, considering that this customer data is available to all marketers via Google Analytics and CRM platforms.
10% of marketers aren’t sure which channels will generate most value for their campaigns, and of those that are sure, 17% have not allocated their budget to those channels! It’s all a bit of a mess, really.
So, this survey revealed that the majority of marketers are spending their budget ineffectively. However, we don’t think this is because they’re investing in the wrong places, they just seem to suffer from a huge lack of confidence in their operations.
We need to improve this if you’re to invest your marketing budget in the right areas. Luckily for you, we’ve got some tips!
So, how can you make sure you’re spending your marketing budget effectively?
Know your audience
Your top priority should be getting to know your audience. You need to understand their needs, intentions and desires, as well as their individual customer journey.
Basically, you need an end-to-end understanding of all your customers’ interactions. This will lead to more personalised campaigns which are more effective and engaging and will, eventually, increase revenue – hooray!
Try implementing user analytics and data management platforms to create a comprehensive view of your target customers. From there, you can create highly accurate audience personas that can act as the focus of new content. Use CRO techniques to make sure this content is relevant, effective and sent out at the right times.
Gather and assess data
Next up, you need to ensure you can track the success of everything you invest your marketing budget in. Precise measurement allows you to know, with certainty, that you’ve reached your goals.
Consumption metrics (traffic/impressions) and customer acquisition costs are used by a whopping 31% of digital marketers. So, it’s a good idea to start there.
However, engagement metrics are trailing behind (at 29%), so you better give them a little TLC. There’s no point bringing people to your site, or creating content, if the audience isn’t going to engage with it. Make sure that hooking users in is one of your key goals.
In the Greenlight survey, marketers admitted to struggling with multiple data sources (44%) and assessing offline spend (35%). If these are a problem for you, it’s worth investing in a good analytics platform/procedure that encompasses all your sources – including offline purchases – so you can get the highest-quality data possible.
You can then use that data to inform your content creation and delivery strategy. This will help ensure that the right content goes to the right people at the right time – the core aim of any marketing strategy.
From there, we’re sorry to say it’s trial and error. Carry out tests to establish which areas achieve the best ROI and make decisions based on that.
This will be different for every business, so we can’t say for sure which will work for you. Just keep your company’s goals in mind, measure everything and you won’t go far wrong. Good luck!