Keys to a Successful Marketing Budget

6a00d83451b74a69e20163037ba3ab970d-piMarketing budgets can feel like a chore without a dedicated marketing team crunching the numbers, but every business needs one to succeed. Why?

Because every dollar spent differentiating your business from your competition can earn you five to ten dollars in revenue.

That’s how valuable having a marketing budget is, yet, most businesses find themselves marketing by the seat of their pants because budgeting is a challenge.

What’s The Challenge?

The time and resources required to develop an effective marketing budget are usually scarce, especially for small to mid-sized businesses. The budgeting process is more than just picking a dollar amount, choosing your marketing channels and then creating marketing pieces. It also has to account for research, personnel and tracking.

Before You Begin

It may be your first instinct, but marketing budgets should not begin with how much you are willing to spend. They begin with establishing who your target audience is and researching who can benefit from your product or service the most. Define what they look like, what they do for fun, where they go for information and what they value.Then ask yourself, “What about my brand will differentiate us from our competitors in the target audience’s eyes?”

With a clearer view of your target audience and vetted differentiators, you may research what marketing channels best communicate your differentiators to your customer. For example, if you’re marketing a professional service to other businesses, you might consider LinkedIn or a robust SEM strategy. If you’re marketing a product to millennials, you might consider Facebook or remarketing.

Set Your Goals

Set expectations and benchmarks to measure your progress, but be realistic. If your target audience is small, can you really achieve $5 million in new sales over the year? Can you truly convert 50% of leads when the industry average is 10%? This is not to say your goals shouldn’t be challenging, but make them achievable for the sake of your employee’s morale, your sanity and your bottom line – this is your opportunity to define what your success looks like.

Just having goals is not enough. You must establish tools and a process for tracking your success and making changes. Facebook provides HTML pixels to help you attribute website conversions to a specific Facebook ad. Landing pages or unique URL’s on your website will help you identify campaign related traffic and leads. Promotion or QR codes will help track the success of promotional offers. The key being, if you can’t measure it, don’t do it.

What’s Your Budget?

Traditionally, your marketing budget should be around 10% of your gross revenue. If you are a newer business with less brand awareness, that number could reach as much as 40%. If you are an established brand, that number may drop as low as 5%. No matter the case, your marketing budget should be built to meet the goals you previously set, and focused on reaching your target audience through the marketing channels you researched.

Luckily for businesses today, the digital age has made marketing much more cost effective. A Facebook ad can reach just as many customers as a newspaper ad for a fraction of the cost. A YouTube video can drive website traffic better than any ad buy for television or radio, and an optimized e-commerce website can move product faster than most high-traffic storefronts.

That being said, digital and social media marketing relies on your understanding of your target audience. If your target audience research is off the mark, your well crafted marketing will fall on deaf ears.

The Bottom Line

Building your marketing budget begins before you budget. Careful planning and thoughtful research will set your marketing up for success, and “(tracking) makes perfect.”

 

Spending Your Advertising Budget Wisely

images (3)A recent report by admanGo focuses on some recent Hong Kong advertising spending figures. Confirming everyone’s suspicions, the total ad spend in the city in January and February of this year was HK$6.01 billion – representing a 13 percent drop compared to the same period last year, and the first double-digit decrease since 2000.

Magazine advertising was particularly hard hit, falling by 28 percent, while Television Broadcasts Limited (TVB), one of Hong Kong’s major TV channels, recorded a 9 percent drop in its ad revenue.

The main reason cited for this drop is the continuing decrease in retail sales due to fewer visitors arriving from the mainland, and that is true to an extent – we have all taken a hit from that. However, the reality is that traditional media advertising has been becoming less popular for years.

The good news is that this doesn’t mean your advertising spend has to be less effective – far from it. By choosing the proper channels and targeting the right audiences, you can still ensure that your advertising budget delivers excellent value for money.

Digital brings targeted results and better returns
In Hong Kong, today’s typical consumer takes in brand information through a range of different channels. With digital becoming increasingly more dominant, particularly mobile channels, brands that apply multi-channel, multi-platform advertising are experiencing outstanding results. They are deepening engagement and increasing their interaction with their target audiences, and doing so at a reduced cost.

For years, experts have been saying that digital platforms are the future. That future has now arrived. With the incredible power and portability of today’s technology, digital advertising – especially mobile and social media ads – can send finely-tuned messages to highly-specific audiences at a very reasonable cost.

Digital can activate engagements across different touchpoints in both the digital and physical worlds, and soft selling via games, social media, or app-based promotions is helping to boost two-way communication and making messaging more personal. All this is driving customer behaviour and taking advertising in bold new directions.

Apps, with their relatively low cost and potentially huge reach, are becoming the preferred method of mobile engagement for companies. Apps using augmented reality can provide useful services like directions to preferred restaurants and instantaneous translation, or they can bring embedded digital content in static ads to life via QR codes. The best part is that when done well, these apps do not even seem like advertising.

Real-time location-based mobile ads are now becoming mainstream, allowing audiences who opt in to receive product news, deals, and discounts that are targeted specifically to them when they are nearby a particular store or branch. By filtering promotions based on location, demographics, and other available user information, this method of advertising allows companies to create highly specific promotions for precise audience segments at comparatively low cost.

Social media also provides ‘low cost, high reach’ exposure. Success stories of posts and videos ‘going viral’ on Facebook abound, while today some campaigns are run exclusively on Twitter and Instagram. Take the “1600 Pandas World Tour in Hong Kong: Creativity Meets Conservation” event as an example. The campaign brought 1,600 irresistible papier-mâché pandas to Hong Kong to raise awareness of the importance of panda conservation work.

Before the exhibition began, these small but loveable pandas began appearing at various landmarks like Victoria Park, the Hong Kong Cultural Centre, and on trams, with citizens and celebrities alike taking photos and selfies with the pandas and sharing them on Facebook. The campaign generated many shares and likes, creating a lot of excitement and awareness for comparatively little investment.

Aside from these new methods of ad delivery, we are also seeing incredible advances on the measurement side as well. Big data technology is allowing us to measure the effectiveness of ads in ways that were impossible even a few years ago.

Thanks to the proliferation of addressable media, including targeted online ads and traceable social media activity, we can now measure the return on investment of discrete digital marketing channels. We can also get a full picture of the effectiveness of a digital marketing campaign in real time, allowing for timely adjustments to an on-going campaign and recalibration for future campaigns.

Consistency is paramount
This is a pivotal development. Traditional media advertising delivered a one-way message. Today, social media ads are fully two-way – engaging with customers on a small-scale level, sometimes even one-to-one. The aim of traditional advertising campaigns was usually quite linear, designed to convert targets into customers and get them to purchase products.

Today, a campaign can have multiple aims, moving from online to offline and back again. Ads can be designed to drive traffic to a website, or attract people into physical or digital stores, or simply to get them to ‘like’ a particular social media page.

In this fast-moving and complex digital environment, it is vital that the brand promise and any associated messaging is clear, consistent, and rock solid. With ads running on multiple platforms and channels, every element, platform, and channel must be aligned with a single brand promise, and all messaging must be working in the service of that promise.

To spend your advertising budget sensibly, you must frequently review your strategy and make sure that it is relevant. Despite the downturn in the retail market, companies that embrace digital and follow a holistic, integrated strategy will continue to be successful and enjoy handsome returns on their advertising spend.