Where Should Businesses Spend Their Online Marketing Budget?

As brands and consumer touchpoints in the online space become more integrated throughout every aspect of a person’s life, every business must ask the question, “Where should I be spending my digital marketing dollars?” There are so many channels to choose from, and just not enough time or money to devote resources to every channel out there. You have social media, email, content marketing, on-site SEO (search engine optimization), display ads, remarketing, video ads, paid search, and more. So what mix of resources should you be spending in each channel?

The answer: it depends…

Now that’s probably not what you wanted to hear, but it’s the truth. Businesses are not the same across the board, and neither are marketing strategies. As the old saying goes, “If it were easy, everybody would do it.” Instead of simply applying a plug and chug formula to marketing spend, every company must look within their business and at the surrounding climate to determine the best course of action. By asking certain qualitative and quantitative questions about your business, you can better understand the solution to your digital dilemma.

There are three categories that your questions should be based around: business goals, audience, and competition.

What Are My Business Goals?

Let’s start with your business goals. When running any type of marketing campaign, the first thing you should always ask is, “what are my business goals?” Direct sales may require a different channel than brand awareness, and lead generation will require a different tactic than increased visibility from search engines.

To paint a better picture, if we realize that no one knows who we are, we will need to get our name out there. Brand awareness can be extremely important for unknown businesses, and certain channels are fantastic for obtaining just this. Video ads, display ads, and social media advertising can all put your brand in front of hundreds or thousands of targeted users, sometimes for mere cents.

Who Are My Customers?

Next, we move onto your customer base. Who are they? Where are they spending their time online? Where would they be likely to take action toward your goals? It is important to know these things, because if they are among a younger demographic, perhaps it is a good idea to target them on mobile devices over desktop.

As an example, if your business is centered around sporting goods, your consumer is likely a person who enjoys playing and watching sports. Therefore, it would be a better idea to show ads on sites that feature sports articles or game analysis, as opposed to a mommy blog discussing the latest cookie recipes. Now, this doesn’t mean that people who visit cookie recipe sites never like sporting goods. It just means there is a far higher correlation between those who read sports articles and those who also play sports. You have to remember it’s not about catching every single potential customer, it’s about spending your marketing dollars effectively and working to get the best return on your marketing investment. So while you probably could spend hundreds of dollars to find the few baking and sports enthusiasts and hope they become customers, you could save a lot of money by targeting people based on their related interests.

What’s The Competition Like?

So what are your competitors doing, and what aren’t they doing? Is the market extremely saturated already? Or is there room for one more player? These are the questions that need answers in order to help determine marketing amounts. There are plenty of tools available, from free to paid, that will go deep into letting you know what your competition is doing.

Certain free tools, like Adwords Keyword Planner (a tool from Google for search ads on the Google network), may not be able to let you know exactly how much another business is paying, but it can still let you know the lay of the landscape. This includes information like search volume of keywords, how much an ad click costs, and relative competition of how many others are bidding on a certain term.

On the other hand, once you start paying money for software, some limitations to competitor information are lifted too. Information like how much they are spending, what channels they spend on, what keywords they may be ranking for naturally, etc. can be found on a plethora of paid informational marketing tools. The only advice to give when you are determining which paid softwares to use is, “Does the information obtained from these tools provide enough value to warrant the subscription?” You could find out all sorts of information from these softwares, but if you never leverage it, the software is useless to you. In fact, it’s worse than useless, because it is costing you money. Many paid softwares do offer trials and reviews, so try to do a little bit of research of each software before hopping on the data train to competitor analysis.

In Conclusion…

In the same way, your business is the special snowflake offering some advantage over your competitors, your marketing campaigns need to be just as special. There is no one size that fits all to marketing, and it is something that does require a bit of thinking and strategy.

In order to accomplish this, many questions about your business must be answered, but the most important ones boil down into three categories: your campaign goals, your consumer audience, and the competition to your business. Once you figure out all relevant answers within these three categories, you’ll begin to see the recipe for your own digital marketing mix.