August 11, 2015

3 Steps to Planning Your 2016 Advertising Budget

By: Alicia Ruemelin | Marketing Communications Specialist

Budget-Planning

To most business owners, advertising is the toughest part of their business. How much to spend? Where to advertise? How often? What information to include?

Digital advertising is expected to become the number one media category in 2016, surpassing television spend for the first time, according to comScore. By now, business owners have likely established back to school and holiday marketing strategies; now is the time to start thinking about 2016 advertising efforts.

So where do you start?

If you want to build sales, it’s almost certain you will have to advertise. The old adage, “you have to spend money to make money” couldn’t be truer when it comes to marketing.

 

1. First, Determine Your Budget

The most common mistake when planning a budget is honing in on the total amount you want to spend (which can be overwhelming). It’s more important to determine how many extra sales leads your business can handle and what the value of just one sales lead is to you.

Here are some additional questions to ask yourself when determining your advertising budget for 2016.

  • What is my goal? (e.g. maintaining existing clientele, driving new customers, etc.)
  • Who is the ideal audience?
  • What time of the year does my ideal audience buy?
  • By what percentage do I want to grow sales?
  • How much am I willing to pay to acquire one new sale?

Once you have successfully answered the questions above, you can back into determining what your overall advertising budget should be. For example, if I’m an insurance agent who wants to sign 12 new policies each month at an average annual commission of $300 per policy, how much should I spend to achieve this? Let’s say I’m willing to spend $75 to acquire one new sale (25% of the $300 worth); simply multiply 12 times $75 to come up with a monthly budget of $900.

 

Insurance-Agent-Budget-Example

 

2. Ok, I have my budget ready. Now where should I spend it?

Once your overall budget is determined, now comes the hard part. To help allocate your marketing investment, it’s important to take a look at some of the top advertising trends over the past year.

Less than a year ago, mobile was the next best thing and advertisers were hesitant to invest their money. Now that mobile searches have surpassed desktop searches, advertisers are regretting not investing. Staying up to date on the latest industry trends and predictions will help you make the right decisions for your business.

Here are some digital tactics to consider when planning your budget for 2016.

Paid Search-Header

What is it? Campaigns on search engines, such as Google, are the foundation of a comprehensive digital marketing plan. These ads can be found on the top and right rail of a Google results page.

What’s the benefit? Advertisers only pay when someone clicks on their ad, making it an efficient way to drive sales leads to your business.

Mobile-Header

What is it? Advertising for mobile devices comes in various forms. To simplify this in one sentence – both search and display ads can be optimized for mobile devices in both apps and browsers.

What’s the benefit? No matter what type of mobile advertising, this is the best way to capture users on the go. Whether your focus is online conversions or offline sales, mobile ads can drive performance.

Social-Header

What is it? Social ads come in a variety of different forms, right rail ads, news feed ads, in-stream video ads, etc. Before choosing what sites to advertise on, make sure to establish your goal and know where your consumers spend their time.

What’s the benefit? Strategies on sites like YouTube and Facebook can be built around business goals, whether you’re looking to promote brand awareness or drive lead generations.

 

3. Don’t Go in Blind

Your first advertising budget will be the most difficult to establish – but trust me, it’s worth it. Establishing a starting budget will help you analyze the results and narrow down your efforts from there. By next year, you’ll have more empirical data than ever before.

Finding the Right Business Partner

As a business owner, understanding your core competencies and knowing your key strengths will help you determine when it’s time to look for a good business partner. If you choose to use a marketing agency, make sure to find one that is willing to be flexible and can provide expectations for performance. A good business partner can provide best practices, recommendations and industry knowledge to help you determine the right plan of action and build a successful business.

 

Tips to Remember

  1. It’s not too early to start planning your budget for 2016. First things first, establish your goal
  2. In the marketing world, it’s true – you have to spend money to make money
  3. Determine how much you are willing to pay to acquire one new sale – this will help you back into a total budget
  4. Stay engaged and read about the top digital tactics available
  5. Test campaigns and measure performance to help you hone in on what’s working for you
  6. Always be flexible
  7. It’s okay to admit when you need help

 

Line Break

Alicia Ruemelin is a Marketing Communication Coordinator at Marquette Group. She is the managing editor of Marquette Group’s blog and the company’s dedicated social media coordinator. As a strong sales support role for our organization, her daily responsibilities also include presentation and collateral development for national corporate clients, new business prospects and local business owners. Follow her on Twitter for more digital marketing updates.

Looking for more information on digital advertising solutions? Follow Marquette Group on Twitterconnect with us on LinkedIn or subscribe to our blog here.

 

 

 

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