Marketing is never-ending. When done right, the more you spend, the more results you will get. However, since everyone has a limited budget, one needs to plan how to use them to maximize ROI efficiently.
A digital marketing agency in Kolkata, Kre8iveminds is well-reputed for providing the best Digital marketing service. You can definitely hire them to gain high ROI in a short period of time. Let’s first look into the factors -
1. Things to Consider When Planning a Digital Marketing Budget
When planning your digital marketing budget for 2021, consider these few factors –
A digital marketing budget depends on three things:
- Company’s goal,
- Product life cycle phase
a. Goals and Objectives
Determining the goal of the company is the most important factor. You cannot plan any budget before deciding what you want to achieve ultimately. Most companies either have the goal to gain more leads or grow revenue.
b. Company Size
Large companies usually have high recurring revenue, which is why they spend a handsome amount on digital marketing campaigns.
Whereas, on the other hand, small businesses don’t usually have that much budget and revenue to spare for digital marketing.
c. Product Life Cycle Stages
First stage – No need to spend anything as the primary focus is launching products.
Second stage – With the growth, companies usually spend a higher percentage of their revenue on digital marketing strategies.
Third stage - the maturity phase, companies spend a small percentage of their revenue as the product is already well-established.
Fourth stage is the decline and requires no need to spend anything on marketing.
3. How to Allocate Digital Marketing Budget in 2021?
It is highly recommended to analyze which channel works best for your business before you start allocating budget to various digital marketing platforms. This way you can spend more on stuff that provides you the highest ROI, spend some of the budgets on new and trendy channels, and avoid wasting budget on things that don’t contribute to achieving your goals.
4. How Much to Allocate to Various Channels?
a. Organic Marketing
Organic marketing or SEO (SEARCH ENGINE OPTIMIZATION) usually takes some time to show the desired result but definitely pays off in the long run. If you are not looking for a quick result then invest your efforts in Organic marketing.
b. Paid Advertisements
If you want to get leads and conversions just like that, then Paid ads or PPC is the thing for you. Spend on PPC and you will get quick results. However, PPC is comparatively expensive and will exhaust your budget quickly.
c. Social Media Marketing
Social media may not be the right channel if you want direct conversions. According to a report released in 2018, Social media serves 2% of conversions, which is the lowest of all channels. It should be optimized well when you are looking to build an audience, reaching them with offers, creating engagements, and interacting with them.
d. Email Marketing
Email marketing has the highest conversion rate of all. You have to maintain your subscribers' list. Not all traffic on your website converts immediately. But if you manage to get them to subscribe for emails, you can send them your latest offerings.
5. Is this much information enough?
NO, not at all! An effective digital marketing plan needs continuous improvement. You will start getting data, once you have started digital marketing. Do not forget to track all the traffic, conversion, and other marketing intelligence data. This will help you sharpen your digital marketing budget planning in the future.
I’m the writer of the above article. I am no marketing guru but writing content on trending topics has been a part of my life since my school days. I look at the topic from a beginner’s point of view and love to explain it in my own words. I hope the blog will be helpful to you. Best wishes.