5 ways to optimize your digital marketing budget
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Marketing budgets are usually tight. To maximize profitability, every dollar must be allocated effectively. Here are five strategies that can be implemented instantly to get the most out of marketing budgets.
1. Focus on what works best.
Set goals in Google Analytics to effectively measure the source and quantity of leads or sales. By comparing sources such as paid campaigns, organic traffic, and social media channels, you can apply the Pareto principle, also known as the 80/20 rule.
You will find out which sources generate the majority of sales to adjust your budget allocation later. Use the Pareto principle and identify the 20% of your top traffic sources that generate 80% good results. Focus your budget there. Especially for small budgets, it is often more efficient to allocate it on the 10% that generate 90% of the results.
Related: The 80/20 Rule of Sales: How to Find Your Best Customers
2. Stay in control of budget and targeting.
Not all marketing solutions allow full control over the amount spent and who is targeted. Instead of spreading your budget across a wide variety of platforms, focus on those where you control both targeting and cost. Examples are the online advertising giants, Google, Bing and Facebook.
The more control you have over what you can spend your budget on, the more you can get rid of what doesn’t work and focus your limited resources.
3. Don’t scale until it’s profitable.
Any marketing campaign, online or offline, should be launched on a small scale with narrow targeting. Once profitable, the campaign can be scaled. Scaling can mean experimenting with different types of campaigns on the same platform as well as adding other platforms.
The reasoning behind the modest start and expectation of ROI is two-fold: first, the initial campaign profit creates a buffer for potentially unprofitable additional campaigns or platforms. Second, business owners now know exactly what works well. They can base other marketing efforts on this, or simply spend more budget on the initial campaign, without significantly increasing the risk of missing a return.
You should also consider the importance of having statistical significance in the results before deciding whether or not to increase your investment. Always support your decision with enough information about the data.
Related: 3 Social Media Marketing Plans For Every Startup Budget
4. Align marketing efforts across all channels.
Every dollar and minute spent on marketing should communicate the same message. This includes accounts that have never been used for paid campaigns such as Instagram or, in some cases, Pinterest and Twitter. In business, time is money. Therefore, social media accounts and similar branding efforts are never free and should be considered the same as paid marketing solutions, such as print media and paid online advertising campaigns.
5. Cross-channel remarketing.
Remarketing or retargeting means that you are targeting website visitors who have not yet converted on the same platform they were originally targeted on. For example, potential customers who clicked on an ad in Google but did not convert are re-targeted in Google with the same or different ads. Cross-channel remarketing takes it a step further by retargeting users on another platform. For example, potential customers who clicked on an ad in Google but didn’t convert now see ads on Facebook and Twitter tailored to the pages they visited. Cross-channel remarketing will boost the effectiveness of your advertising campaigns.
Related: 15 Must-Have Marketing Tools for 2015
