It’s January. Personally, we’re all making resolutions to improve ourselves as people. And professionally? We’re not making resolutions per se, but we are looking for ways to make 2019 a roaring success.
There are a lot of business decisions to be made at the start of a new year. And in some ways, those decisions aren’t unlike the resolutions we make to be better versions of ourselves. But business improvements are generally constrained by budget dollars. So how do you set your marketing budget allocation for the coming year? Measuring the value of marketing budget dollars can be challenging — just as challenging as determining the value of different New Year’s pledges.
I recently came across a list of the most common resolutions people made for this past year. The value of each isn’t always easy to quantify — but that doesn’t mean it’s not there. Marketing investments can be much the same.
The top three resolutions on that Statista graphic are by far the most common — and the most quantifiable. People adopt new diets, take up exercise regimes, and visit their financial planners. And whether or not the average person sticks to their New Year commitments, the results are certainly easy to see.
The success of a new diet or fitness plan can be measured in pounds or inches lost, or pants sizes dropped. A pledge for better fiscal behavior will yield more money in savings, or fewer debts. It’s clear whether or not these type of resolutions have been a success.
In terms of marketing budget investments for 2019, PPC (pay-per-click) marketing, social media advertising, and email marketing are similarly simple to assess. Dollars spent can be easily tallied and tracked against audience response. At first glance, it may seem like these are an obvious choice for budget allocations in the coming year. And they might be — but they might not be as well.
Easy-to-measure marketing budget investments also tend to be relatively affordable and provide quick results. When combined with their measurability, their appeal is apparent. But does that mean they’re right for you?
When contemplating investments in this type, consider the following:
- Do you need to engage your clients in the short or long-term? (The impact of PPC, social, and email marketing fades as soon as it disappears.)
- Is your target audience likely to see — and respond to — the ads you put out? (If you’re not sure where to reach your customers, you could be spending on something they’ll never see.)
- Do you have an existing market that should be nurtured, or are you trying to reach new eyes? (It’s important not to focus all your marketing dollars on new clients while neglecting loyal customers.)
Easy-to-measure marketing budget strategies definitely have their advantages. They’re ideal for reaching new audiences or drawing attention to a new product or promotion. But they’re probably also not the only place you should be allocating marketing dollars.
The next few most popular resolutions people make are still measurable — although assessing their true value can be a little trickier than those we’ve already discussed. Practicing self-care (things like getting enough sleep or taking up yoga) and reading more books are certainly positive goals. But calculating their value isn’t as easy as stepping on a scale or checking an account balance.
The marketing budget investment equivalent to these resolutions include things like SEO (search engine optimization), content marketing, and developing online communities. As you consider your marketing budget allocation, there’s no doubt these have value in building your brand — but it’s a value that doesn’t come with hard numbers to back it up.
So should you be spending on this kind of marketing?
All signs point to yes. Experts at Forbes, when predicting marketing trends for 2019, point to two significant trends that make these harder-to-evaluate marketing tactics well worth their costs:
- The growing importance of customer success, where companies must ensure clients get the maximum value from their products
- The shift in the shape of the traditional marketing funnel to more of a cyclical pattern
As customers grow to expect more and more from the businesses they frequent, investments in customer retention (as opposed to a sole focus on acquisition) is becoming critical for success. Providing value to your clients — by way of marketing — is a necessity.
Obviously, cultivating your online community or improving the performance of your blog posts isn’t the ideal way to grab the attention of a new audience. If you need new eyes, don’t stash all of your marketing dollars in this particular basket. But neglecting to allocate any budget dollars for this type of relationship nurturing with existing customers could definitely cost you if you’ve already got an established base.
Hard to Calculate
The last few resolutions on Statista’s list have a value that is pretty much impossible to measure. There is no way to quantify how much taking up a different hobby or making new friends can improve your life — but does that mean you shouldn’t bother?
The value of marketing budget allocation on things like public relations campaigns or TV, radio, or print advertising is equally difficult to compute. Should we assume that this type of initiative is worthless? Obviously not. There isn’t a business owner around who doesn’t realize that PR and advertising definitely have value.
“Brands are built on what people are saying about you, not what you’re saying about yourself.” – Guy Kawasaski
Public relations — and to a lesser extent, ad campaigns on older, more “traditional” media — are about building your identity. Establishing your organization as a reliable, credible partner and a leader in your field. It’s showing that your team is active, current and (ideally) growing. It’s about branding.
So do these tactics fit into your marketing budget strategy? Ask yourself a few questions:
- What are you trying to achieve? Are you building your brand, trying to draw attention to a new product or service, or working to maintain a connection with existing customers?
- How important is it that your results be quantifiable? Although there are those who make a case for the measurability of PR, will your ROI on this type of promotion be harder to calculate than other marketing efforts?
- What is your timeline? Public relations and old-school advertising lack the immediacy of an online ad campaign.
As always, the viability of these tactics depends on what your goals are and who you’re trying to communicate with. Establishing your credibility and brand identity is useless if no one’s ever heard of you — but you won’t develop a large, loyal customer base until you have.
Which Marketing Budget Choices are Right for You?
Different marketing tactics have value for different organizations in different situations. Odds are that the best strategy for your marketing investment is to split your efforts between more than one of these categories. But it’s important to understand that a technique that produces easily measurable results isn’t automatically the right one for your business.
You must have a clear idea of who and where your audience is, and what they need, to be receptive to your message. Not sure how to figure that out? The experts at TPM can help — get in touch with us today.