Digital Marketing Budget Allocation: 5 Things to Consider 


All businesses, be they corporate or startup, have different needs. However, there’s one need that is common. Everyone wants to get their brands noticed on a global level.  

Ever since adopting technology has become convenient, businesses could directly connect with global customers and create a loyal fan base. Moreover, we also see today’s businesses allocating digital marketing budgets and strategies.  

Digital marketing budget allocation helps businesses to stay competitive and increases their expertise levels to achieve the desired results. But setting up the digital marketing budget can seem daunting to some, especially small business owners.  

Thus, to help them get the planning and structuring of the digital marketing budget under control, here are five things you should consider during allocation.   

ALSO READ: AI in Digital Marketing: Where Does the Future Lie? 

1. Understand The Customer Sales Cycle 

A sales cycle or sales funnel is a phase that potential customers go through before finalizing a sale or purchase. So, the phase is likely to be different for every business and customer.  

While it is impossible to set up an individual marketing budget for every customer, what you can really do is understand the sales funnel for every customer type. Doing this will give you an idea of which digital resources and tools to include as a part of the customer retention process. 

2. Have Clear Marketing Goals 

Even when you have the budget and a strong digital marketing team, you must have distinct marketing goals. Otherwise, all your efforts can go in vain.  

Therefore, set your marketing goals before you allocate finances. Think about what your goals are and what types of resources you may need to achieve them. It will give you as well as your team a clear idea of where your business is heading. 

3. Backtrack Your Previous Marketing Strategies 

The best way to improve while going forward with your new marketing budget is by tracking the efforts you’ve put in previously. So, take time to assess our previous marketing strategies as you’ll get an idea on  

  • what worked and what didn’t 
  • the amount of financial capital used at the time 
  • the amount spent on digital ads and the returns you received 
  • if you could resolve previous issues 
  • if there was any need for increasing the spending amount 

If you find that certain strategies worked in the past, chances are they may work again. Make sure to test out all the tactics before you commit. 

4. Factor In the Marketing Costs 

When it comes to engaging and retaining customers, content marketing is one of the best ways to assure it. As per statistics, most companies spend about 46% of marketing budgets on developing engaging content on average. While publishing content may be free, the marketing budget surely gets used up fast when you’ve to pay creative writers and freelancers to produce new content.  

You may hire in-house writers for the task instead of freelancers. However, as a business owner, you must always factor in the difference before you decide. 

5. Follow a Budget Allocation Rule 

When you’re ready with your digital marketing strategy, the final step is budget allocation using the 70-20-10 rule. According to this rule, 70% of your money should be allocated to the strategies that can help reach your goals, 20% should be used on developing new strategies, and 10% on testing out new tactics for the future.   

Make sure you give less priority to the tactics that worked in the past. It will give you a clear idea of how much capital you can allocate for these strategies. Also, allocate less capital to the strategies that either failed, gave fewer returns, or were less successful in the past. 

Final Thoughts 

Allocating a digital marketing budget will seem daunting if you’re unsure about the amount of financial capital required to improve your marketing efforts. However, by considering these five elements, you’ll find it easier to allocate the right amount to your digital marketing budget. Also, stay open to changes when required. 

About the author

Samita Nayak

Samita Nayak is a content writer working at Anteriad. She writes about business, technology, HR, marketing, cryptocurrency, and sales. When not writing, she can usually be found reading a book, watching movies, or spending far too much time with her Golden Retriever.

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