Determining a budget for any online advertising campaign can be an arduous task, especially without any data to go by.
Digital marketing requires funding to run, and the budget will have to be taken into account.
Before starting any inbound marketing campaigns, you will want to determine what you can afford to spend on advertising, both monthly and daily, and what makes financial sense in regard to your bottom line.
You will want to determine your absolute maximum marketing spend (i.e. the amount you can afford to lose and still sleep at night), and set that figure as your ceiling.
Once you know how much you can afford to spend on your marketing campaign: it's time to take a look at how much your competitors are setting aside for their Ad spend.
You will need to determine what others in your market are spending on advertising, and more specifically: what your competitors are spending.
What Influences Your Advertising Budget
Your Inbound Marketing budget is determined by several factors including, but not limited to: (1) your market, (2) your products/services, (3) your objectives, and (4) your audience.
In his new book, Perennial Seller, Ryan Holiday says that a rational, efficient advertising campaign involves two key things: knowing how much a customer is worth to you (or a customer's LTV-lifetime value) and knowing how much it will cost to acquire that customer via the advertising you intend to use (or CPA-cost per acquisition).
Due Diligence Matters
As with any marketing campaign, before you can realistically append the “-ing” and call it marketing: you need to do some due diligence with thorough market research.
Some of the best market research tools available are Google Trends, SEMrush, and Moz.
Facebook Business Audience Insights is another option, and one of my personal favorites, as it can provide great insight into both the direct and the indirect interests of your target audience.
Gathering intelligence on the wants, needs, and desires of your audience will provide the foundation for measuring the effectiveness of the online marketing strategies your competitors are implementing and using regularly to attract and retain customers.
Find Out How Your Competitors Stack Up
After you get an idea of what your target audience looks like, it's time to do some competitor bench-marking.
Competitor bench-marking can be as simple as going through your competitors online pages, websites, and other mediums to see what they are doing, and how it relates to your business and performance goals.
I recommend finding the top 5 competitors in your area, and 1 or 2 of the top competitors in the U.S. and/or in the world as a benchmark.
Finding your top competitors in any market can be as simple as entering various search terms in Google that a potential customer would use when looking for your product(s)/service(s).
Once you choose your top competitors: you will want to reverse engineer their online presence [thoroughly] for about 2 weeks to 1 month.
Reverse engineering your competitor's strategy can be as simple as following their social pages (e.g. Facebook, and Instagram), signing up for their email list, and clicking through their ads [which will start showing up on your feeds after you follow them].
You can get more advanced by breaking down your competitors URLs in SEMrush, Moz, etc. for complete visibility of their online presence, including links, social signals, and much more.
Using the online tools available and even simply signing up through your competitors sites and landing pages: you can get a detailed overview of just about everything going on behind the scenes of your competitors.
It's important to get an accurate sense of how hard your competitors are working to reach their audience and how much harder you will need to work, not only to be competitive, but also to be a marketing force that drives results and delivers the ROI that you want and need.
What Works and What Does NOT Work
It is important to check to see what is working and what is not working for your competitors.
Not everything that goes "live" online is effective, or even relevant to the audience for which it was originally intended.
These insights will be crucial to developing your most effective marketing strategy.
Do NOT re-invent the wheel.
If you try to be too creative: you might just wear yourself out and waste a bunch of money for no reason.
The key to successful digital marketing is to use what's already working online and try to make it better by improving the User Experience (UX), providing more value to potential customers, and going the extra mile to satisfy and retain existing customers.
Differentiate yourself, honestly, by effectively communicating what separates you from your competitors and why your audience should choose you over someone or something else.
After all of this: you’ll be ready to build out an effective Inbound Marketing pipeline, and start running your advertising campaigns.
Data is Your Marketing True North
Monitoring your online traffic with tools such as Google Analytics will be vital to your overall online marketing success.
Data is EVERYTHING in Digital Marketing.
Why?
Because marketing without data is like driving with your eyes closed…
…it doesn’t work.
After executing and implementing the above strategies:
there should be enough data that you can use to further define and refine your target audience(s) and hone in on your sweet spot audience of ready-to-buy customers.
This is the power of Data Driven Marketing.
Data will drastically improve the effectiveness of your marketing campaigns, help you minimize your costs, and maximize your overall ROI.
Drive Brand Growth
With any online marketing effort, it follows that the more you spend on Advertising: the more traffic you will likely have coming to your sites.
But do not think of your Advertising budget as a generic cost figure or just another expense.
Your Digital Marketing budget is an investment that will generate measurable, positive ROI over time.
The more you INVEST in your advertising: the more your RETURNS should be.
Always keep in mind that what will truly drive the growth of your brand is "consistently" delivering high quality content, providing VALUE before price, and delivering exceptional User Experience (UX).
Marketing Results, as in business, all come down to customer satisfaction.
To be successful in this online Information Age, businesses MUST focus on (1.) The customer journey and (2.) The internal logistics needed to implement it AT ALL TIMES.
A great customer journey will effectively minimize Cost Per Click (CPC) and maximize revenue.
The better the online experience: the better the customer conversions.
It goes without saying that the best marketing campaigns will be focused on the customer, and the customer will determine the budget.
In the market of life, a business that only seeks to provide the best products/services, and provide the highest value to its audience, will ALWAYS win.
Optimizing the online connection between your business and its respective target market audience will drive positive ROI and growth now and into the future.