Internet Marketing Budget: How Much Should You Spend, Exactly?
It used to be that businesses concentrated their marketing efforts exclusively on traditional (offline) media – like print ads, TV commercials, radio, PR campaigns, events, billboards, direct mail, glossy brochures.
And then the Internet happened.
And then social media changed the Internet.
A recent report by GrowBiz Media, a small business market research firm, and online survey company Zoomerang led to key insights on how much money small businesses are allocating for their Internet marketing efforts. Entitled “SMB Marketing Practices: Small to Midsized Business Survey Results, 2010”, the report gathers information from 751 completed surveys across the U.S., by businesses with less than 1,000 employees.
Among the key takeaways:
- More than half of the businesses with less than $1000 marketing budget are adopting social media practices, most notably in social networks Facebook, LinkedIn, and Twitter (in that order).
- Around 39 percent of respondents are spending more than 20 percent of their marketing budgets on websites (design, development, content creation, marketing, etc.).
- Respondents under 30 years old are the highest adopters of social media.
- Businesses are planning to increase spending next year on these budget areas: website, E-mail marketing, direct mail, social media marketing, and print advertising.
From these, more questions arise:
- What about you? How much should you spend on your online marketing efforts?
- And do you completely move on and forget about traditional media and offline marketing?
- If you’re going to spend on things like online marketing, SEO, and social media marketing, how much should you allocate for each?
- And oh…wait – aren’t most things on the Internet free? Like Facebook and Twitter? What is there to spend for?
As any Internet marketing firm will tell you, the answers to these questions depend individually on each client – and on each client’s budget. What is obvious, judging from the findings outlined in the report, is that more and more businesses in the U.S. are seeing the returns of their investment on what is now a highly diverse, competitive, and perpetually evolving marketing landscape: the World Wide Web.
In this light, we’ve come up with a few guidelines for every small business owner wondering how much should be spent on Internet marketing.
Know the business you’re in. If you’re in retail or manufacturing, for example, you’ll obviously have to spend a bit more, and concentrate perhaps on developing an efficient e-Commerce website. If you’re an independent café or restaurant owner, you won’t have to trouble yourself with as much, but you do have to focus on engaging more targeted customers – through, say, social media and local search campaigns.
Is your brand or business location-dependent? Getting a lot of web traffic isn’t enough. You have to make sure that these visitors are potential customers, too. If you’re a Chicago mom and pop with a hundred thousand hits a month – but from Asia! – you’d have to come up with innovative ways to market yourself on the Internet more effectively. Like, say, Foursquare.
Monitor the competition – and race ahead of it. Dollars spent on an SEO campaign or on a PPC campaign are dollars well-spent if these help you outrank and outperform your competition. Already number one? Create a little more separation by taking more risks and diversifying. And don’t forget to invest on worthy tools for competitive intelligence, too.
Live – or market – within your means. Ask yourself: what can you afford? No use hiring a huge ad agency to produce commercials that you can’t afford to place. Get an Internet marketing company (hey, like Lakeshore Branding!) and see for yourself the business value that these new forms of online media bring to the table. Once you and your marketers have set realistic goals, you’ll be able to budget even more efficiently.
Support offline with online – and vice versa. If businesses are spending, say, 15 to 20 percent of their marketing budgets online, it still means that the rest of it – 80 to 85 percent – are being spent offline. It’s best practice to promote, via the Web, whatever you’re doing offline, as it is to support your Internet marketing efforts with traditional media strategies. (If you need tips, feel free to read our recent post on this very topic.)
Understand that web marketing takes time. Time and effort, actually. A number of tools on the Internet may be free, but time isn’t free. Labor isn’t free. So don’t cling to the belief that it’s all going to end up happily-ever-after unless you’re willing to dedicate hours and human resources to get the job done.
Still unsure how to spend your marketing money in the Internet age? Or are you still hesitant of the viability of the Internet age?
Well, if you need convincing, you can always give Lakeshore Branding a call. (Insert smiley here.)
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