It’s a business fact so basic that it tends to go unsaid: customers have to know you exist before they can buy from you. This simple truth forms the basis of marketing.
Marketing is more than simply putting your brand up in lights. When done well it will generate brand awareness, it will frame your brand or offering as the best choice, and it will drive a prospective customer toward a purchase. It’s a customer journey that we at Growth Partners describe with the acronym A-C-T: awareness, consideration, transaction.
The power of quality marketing is undeniable, and most businesses know they should make an investment in it. The question that many get stuck on is not if, but how much they should invest.
In this guide we’ll help you answer that question.
What is a marketing budget?
A marketing budget is a plan that outlines how much you will spend on marketing, and how it will be spent, over a certain period of time – usually the next three or 12 months.
A marketing budget can cover a wide variety of expenses, including paid advertising (both digital and traditional), website construction and maintenance, content creation, SEO and social media management, sponsorships and PR efforts, marketing automation solutions, and hiring a marketing team or outside consultants.
While traditional marketing channels like broadcast, print and outdoor advertising still have their place, the overwhelming majority of Australian marketing spend is now directed at digital channels, so that is what we’ll focus on in this article.
Why is it important to form a digital marketing budget?
On the internet an Aussie business will find itself competing against the rest of the world for the attention of its target audience. In such a competitive arena, strategic, considered decisions must be made in order to drive a return on your marketing investment.
A carefully crafted digital marketing budget forms this plan of attack. It considers how much money you’re willing to spend, or you should spend, then allocates that money in a way that maximises ROI.
Generating a return is no easy feat. Many Australian businesses have dipped their toe in digital marketing only to be disappointed with the results. Sometimes this is due to being burnt by a digital marketing agency, sometimes it’s due to a lack of long-term commitment to the process. It must be remembered that results don’t happen overnight.
But at Growth Partners we know just how transformative a systematic, data-driven, dedicated online marketing budget can be for an organisation, because we’ve spent years helping Aussie businesses create these plans.
How much should I be spending on digital marketing?
If you understand the power of an investment in digital marketing, the next question is obvious: how much should my digital marketing budget allocation be?
First, a disclaimer: every business is different in terms of size, goals and available finances, so there’s no single, simple answer to this question. If you came here for a hard dollar figure, we’re very sorry to disappoint.
A better question to ask might be “what is the average digital marketing budget?”, although there is still an inevitable element of “it depends” about the answer.
According to a marketing survey commissioned by Gartner, the average business spends about 9.5% of revenue on marketing. This percentage tends to be higher for B2C businesses than for B2B businesses, and is dependent on whether an organisation is looking to spur serious growth (which may require a figure nearer 15%) or simply wants to maintain its market position (which could be done for a figure closer to 5%).
At Growth Partners we tend to work with organisations with annual revenues of $3M-$100M, which, based on that 9.5% average, would equal annual marketing budgets of $285K-$9.5M.
Again, all these numbers are very rough and very generic, and encompass all marketing and marketing-adjacent spend.
How do I determine a marketing budget?
Creating an online marketing budget is a skill all its own, so determining the size of your digital marketing spend can be a challenge for anyone who lacks experience in the space.
At Growth Partners we do so using our proprietary DigitalArchitect System®, which creates a bespoke marketing plan by considering all relevant factors and strategies, including:
- Search engine optimisation (SEO): We ensure your website is both customer-focused and Google-friendly, moving you up the rankings for relevant search terms.
- Online advertising: We identify the most effective advertising channels for your business to maximise the return on your ad spend.
- Content creation: We create content that makes you more googleable and presents you as the best choice during the consideration phase of the customer journey.
- Competitor analysis: We identify and analyse your main online competitors to reveal issues and opportunities.
- eCommerce: We can help you to build an ecommerce store that attracts and converts more target customers.
Most marketing budgets will feature plenty of other line items, including traditional advertising, talent, software, PR and sponsorships, but with the help of Growth Partners, you can gain a clear picture of your overall spend, and how every dollar and cent will be spent.
DigitalArchitect: high-performance marketing budgets
At Growth Partners we create high-performance marketing plans, including detailed digital marketing budgets, using our proprietary DigitalArchitect System® – a blueprint for digital growth that combines our knack for data science with our deep marketing expertise.
DigitalArchitect® isn’t just a tool to outline your marketing budget. It’s a proprietary, data-driven system that gives us a deep understanding of your customers, your competitors and your market. It reveals who you should target and how you should target them. It uncovers market challenges and opportunities.
In short, DigitalArchitect® gives us all the information we need to both craft a marketing budget, and implement a plan that will deliver real results. We even include a three-year ROI projection, granting you unmatched clarity on the strength of the business case for your investment.
If you’re ready to transform your business with digital marketing, we’re ready to help. Get in touch for no-obligation chat and kickstart your growth journey today.
