How to create a digital marketing budget

Posted on December 1, 2020 by Bold Eye Media

Every business needs customers, which means every business needs to find a way to showcase their products, services, and brand to their target audience. Throughout time, businesses have utilized common tools and resources as ways to make people aware of them and to make them interested in what they have to offer.

From commercials, print magazine ads, and billboards to pay-per-click ads, social media platforms, and emails, relevant marketing tools have transformed over time into mainly digital means. One of the main reasons for the progressive shift into digital marketing is that consumers have technological devices in their hands and they’re able to access them any time.

In an attempt to reach people, marketers have followed suit, focusing their efforts on digital tools and resources. This means that when a business is creating their annual budget, they need to devote a portion to digital marketing in order to most effectively reach their target market.

Knowing that you need to create a digital marketing budget is one thing. However, successfully crafting that budget is another. When you’re facing down the dawning of a new year and a new budget for your business, all of the different parts of your budget can seem overwhelming.

This is especially true if you haven’t had an effective digital marketing budget in the past, meaning you haven’t devoted enough money to your marketing efforts or you’ve devoted them in the wrong place.

The good news is, you can create a successful digital marketing budget. By following a few steps, you can be on your way to a year of effective digital marketing strategies.

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    How To Create Your Digital Marketing Budget

    Establish a digital marketing goal

    You can’t create a plan, map, steps, or budget if you don’t know where you’re headed. Establishing marketing goals will help you to best figure out how much money you’ll need in order to accomplish them.

    Creating your goals means deciding what results you’re going to be looking for in the coming year. Are you focusing solely on gaining conversions? Or are you interested in simply increasing awareness of your brand? Maybe you want to build a base of warm, qualified leads.

    Whatever you’re looking to accomplish will be your goals. By understanding your unique goals, you’ll be able to determine how much money you need and the specific areas you need to focus your budget on.

    Understand your marketing costs/revenue

    Part of planning your budget is understanding all of your costs and your revenue. To know what you’re able to set aside for marketing purposes, you need to first know how much money you’ll have to work with and how much of that needs to be spent in other areas.

    This means you’ll want to look at your operational costs, the cost you typically put out for each customer, and your average revenue attached to various marketing tactics. By understanding what you have to work with and where your money needs to go, you’ll be ready to budget for each of your marketing tactics.

    ” Before you can list the kind of expenses you may be in for, you must understand the 4P’s of the marketing mix: Product, Price, Place and Promotion. ”

    – smallbusiness.chron.com

    Decide on a flexible budget

    After you know your goals and your costs, you’ll be able to section off about what you need for marketing annually. After you determine your annual cost, you’ll be able to divide that into months in order to figure out what you can spend on marketing each month.

    When you section your budget into months, you need to be flexible. That doesn’t mean be flexible on the prices each month. In fact, if you’re flexible on the monthly cost, you’ll end up robbing yourself in another month.

    Instead, you want to be flexible with what you spend your monthly cost on. You may plan to use a certain amount of money on a specific strategy one month, but if you’re seeing success in another area, you may want to reallocate those funds to that area.

    Be flexible about how you use each month’s marketing funds. Don’t strictly stick to your plan because you might just miss out on success.

    ” First and foremost, why do we need to set a budget? This should be obvious, we’re all in business to succeed and grow and accomplish our objectives. So setting a budget is simply a way to plan ahead and make sure we’re allocating enough resources to accomplish what we need to accomplish. ”

    – www.workshopdigital.com

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    Test and measure your budget

    Once you have a monthly budget set, you’ll want to test out your marketing strategies to make sure you’re not wasting that money. You can set up tests and watch the data to see if your intended marketing strategies are effective or not.

    Focus on the number of website visitors you’re gaining as a result of your test campaign. Focus on the number of conversions you’re getting. If your data is looking good, you can be fairly confident that you’ve budgeted your funds well and that your marketing efforts will bring you the results that you want.

    Digital Marketing Is No Longer An Afterthought!

    Digital marketing isn’t optional any longer. Every business needs to devote a portion of their budget to digital marketing in order to ensure awareness, conversion, and loyalty. By establishing your goals, understanding your revenue and costs, as well as testing out your marketing ideas, you’ll be ready to create the marketing campaigns you need to ensure business success.

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