You’ve started your business and you’re ready to grow your brand online. But you keep asking yourself “How much should I pay for digital marketing?” It’s a competitive world out there for a small business owner and even though you want to invest in your digital marketing, you’re unsure of exactly how much. The question is simple, but the answer can be quite complicated, as there are so many factors to take into consideration.
If you were hoping to find an exact number of how much you should pay for digital marketing by reading this, we can tell you now, you won’t. You see, it’s impossible to put a precise amount to it without determining your digital marketing needs, goals and objectives.
These criteria will govern the exact services you require, whether you will be hiring in-house or outsourcing, as well as the time and energy spent on each project and the resources used to do so. The end price you pay should justify the necessary criteria to meet your marketing goals and ultimately, have a higher return on investment.
Every small business’ goal varies with a multitude of different needs, which is why there is no standard approach to how much you should pay for digital marketing. As a general rule of thumb, a small- to medium-sized business should expect to spend approximately 10% of their overall revenue on digital marketing. In this blog, we’ll guide you through several factors to consider when deciding exactly what your business marketing goals and objectives are, to give you a better idea on how much you should pay for digital marketing.
What are you looking for?
As mentioned, it’s important to decide exactly what you want from your digital marketing efforts. Digital marketing takes on a vast variety of elements and it may not be necessary to integrate them all, just yet. The more components you decide are vital in your marketing strategy, the higher the cost will be.
Below are just a handful of examples you can include in your digital marketing strategy:
Web design and development – Having a user-friendly, fast, easy to navigate, a mobile-optimised website is non-negotiable. It’s the way that people perceive your brand in the digital world. So, having an online presence is the essential building block to the start of your digital marketing strategy. Don’t have an online presence? Read our blog on the best ways to build a website here. (will need to add the link once blog is live)
Social Media Management – This has proved as one of the most successful ways to get your brand found and to build a solid brand following. It includes everything from content creation and copy, to community management and analytics.
Search Engine Optimisation – SEO helps you increase and improve the volume and value of traffic to your website via search engines. This can be done through thorough, relevant keyword research and blog content creation.
Paid advertising – You’ll have to consider paid approaches for your digital marketing strategy to ensure you get your posts in front of the right audience. Simply posting organically is not enough. The different digital marketing platforms favour paid marketing over organic as, naturally, it’s how they make their money. This is a big factor to consider in your overall marketing budget. For the different paid advertising types to use click here.
Graphic design – If you don’t have a strong brand presence with brand guidelines that are relevant to your small business and are eye-catching, the chances are your digital marketing strategy may fall flat. Your brand’s look and feel should be consistent across all your marketing platforms. Having an experienced graphic designer can help you achieve this.
If you have read through the above and decided you need all of these tools, you need to be prepared to invest a little more into your digital marketing budget, as this is just the tip of the ever-growing iceberg of elements to include in your marketing strategy.
If you’re still set on them all, the next step is to consider hiring an entire in-house digital marketing team or to outsource. Hiring an entire in-house team can have a huge effect on your budget. And as small business owners, we know that’s a sensitive topic.
If you’re keen to get your digital marketing off the ground but you’re concerned about hiring an entire in-house team you should consider outsourcing.
Outsourcing your digital marketing can cost significantly less than hiring an internal team. This is due to your overhead expenditures being virtually non-existent. Expenses such as office space, furniture, stationery, maintenance, monthly salaries, HR, insurance and employee taxes are all irrelevant. An outsourced digital marketing team has their own software, programmes and tools, which means you will save a huge expense on having to provide these for every in-house employee.
An outsourced team can help your business grow sustainably and comes with the same skillset that an in-house marketing team could provide, without the long-term commitment.
Choose how you pay
How you pay for your digital marketing doesn’t have to be set in stone. There are many options that you can choose from that suit your business needs. Some of these include:
Hourly based – You get to pick and choose what service you need within a number of hours agreed to between both parties. You’re also not obligated to pay for monthly salaries, paying only an hourly rate for the duration it takes to complete the project. This is a great option when projects might need a refresh, upkeep or tweak and it’s easy to keep track of and stay within the budget.
Project-based – This is a flat fee quoted for an entire project and can be based on expertise. This is beneficial when there is a project to be completed within a certain time frame or needs to be completed in one go. An example of a project like this could be an email marketing campaign, designing and developing a website and so on.
Retainer-based – Retainer-based payments are incredibly beneficial once you have tested the water and built a relationship with your digital marketing manager. This is generally used if you have a consistent flow of work that needs to be completed every month, but either you are not committed or don’t have the budget for an entire internal marketing team. The retainer-based option is best for when you have a relatively healthy budget and you’re looking to grow your business quickly.
Customised pricing – A customised pricing structure can be discussed with your digital marketing agency to suit your marketing needs and objectives. It can be agreed upon according to time, budget and necessary deliverables.
In-house – Hiring an entire internal marketing team is by far the costliest of all the options when paying for digital marketing. However, if you feel that your small business has a burning need and budget for this, then this might be the best option for you!
Your digital marketing should make sense for your overall return on investment. Understanding exactly what you need from your marketing goals will help you understand which structure to go with and how much you should spend on digital marketing. Speak to your outsourced digital agency about a package that is best suited for your goals and objectives.
To calculate your ideal marketing budget for 2021 using a digital marketing budget calculator, click here.