Deciding how much you need to invest in digital marketing is a bit like asking how long is a piece of string! It is dependent on so many factors, from the size of your business, your marketing aims and not least your budget. For sure, digital marketing is an essential aspect of any businesses marketing strategy and needs to be given careful consideration.
What is digital marketing?
Before you think about spending any money, you should be clear about what exactly is meant by ‘digital marketing’ in the first place. It isn’t as simple as having a business Facebook page and putting some money into google ads. Digital marketing is way more complex and diverse than that.
Digital marketing refers to using the internet or other means of digital communication to connect with potential customers. These methods may include email, websites, blogs, PPC ads, utilising social media and SEO optimisation. Methods such as these can be used in conjunction with each other, and each has its merits and downsides. How much money you invest in each or all of these areas is dependent on several factors.
What will work for your business?
No two marketing strategies are the same, and different types of digital marketing will work for different businesses. Your challenge is deciding which is going to be the most cost-effective for your business. For example, SEO is effective but requires a long-term strategy. You need to use it well and keep up with the changes that Google make to their search engines; otherwise, it will not prove effective.
Having someone on your team who understands SEO is essential. If you don’t, you should probably consider bringing in an agency or a freelance SEO specialist to oversee your strategy. Of course, this costs money but will most likely be worth it in the long term.
In comparison, PPC ads are effective in the short-term but may cost more in real terms. For example, you may decide that you want 250 clicks per day during your ad campaign. If you set your maximum cost per click (CPC) at 25 pence, you will be spending £62.50 per day just on Google ads before thinking about any other types of digital marketing. 250 clicks isn’t that many, and 25 pence per click is unlikely to generate that many sales in real terms, especially when you consider that you are competing with your rivals to reach those top placings on the google search pages.
“You can’t sell anything if you can’t tell anything” – Beth Comstock
Ensuring that your website is user friendly, has good quality, relevant content and includes well-written blogs is a marketing strategy in itself. It will ensure that your website is treated favourably by those all-important google bots that trawl the web ranking websites. Again, if you have someone in your team who can oversee this aspect, then all the better, otherwise you will need to pay to get your website optimised to ensure the best results possible.
In addition to weighing up the type of digital marketing that you want to utilise, there are other considerations that you need to factor in before you start spending money on digital marketing. These are;
Affordability is obviously the primary consideration! Your business’s size and longevity will often determine how much you can realistically afford to spend on digital marketing. Typically, if you are looking to maintain your place in the market, you should be spending roughly 2-5% of your revenue on marketing. If you want to increase your presence and pursue a more aggressive strategy, you will need to spend more, possibly up to 15% of your revenue.
You will often find that the most cost-effective strategies take more time (SEO, for instance) but will prove more effective in the long term. Organic traffic represents 51% of all traffic to websites, so SEO is a sensible investment of both time and money (if you choose to pay someone to optimise your site for you). Other strategies such as redesigning your website and PPC ads can be put into place much faster but come at a cost, so it depends on whether your goals are long or short term when considering your digital marketing budget.
How varied is your strategy?
Suppose you decide that PPC campaigns are the best strategy for your business and that you will pour all your resources into that at the expense of any other forms of digital marketing. In that case, you need to budget for how much you can spend per day to keep you in a top position on the search pages.
If you decide to have a more varied strategy that incorporates different forms of marketing (probably the best idea), then you will need to portion out your budget accordingly and make decisions as to which form of marketing needs the most investment at any given time.
Are you buying in to an agency?
If you choose to engage a digital marketing agency to assist in your marketing strategy, this will take up most of your budget, but if you choose the right agency, it could be money very well spent. It is important to choose an agency that has a proven history of helping businesses reach their marketing goals. This will take all the worry off your shoulders, and you can rest assured that your marketing strategy will be put in place in the most effective way possible by people who know what they are doing.
It’s clear to see that if you want to secure your place in the digital marketplace adopting an effective strategy is non-negotiable. How much you spend on that is really up to you and is dependant primarily on your budget and which particular strategy or strategies you think will work most effectively for your specific line of business.
While it is crucial not to overspend, it is also worth remembering that long term investment in the right kind of digital marketing will generate long term, positive results.