Breaking Down Your 2020 Marketing Budget

Marketing as an industry isn’t new. From shouting in bustling market squares to donning sandwich boards, humans have sought to promote their goods and services for as long as, well, goods and services have existed.

But 21st-century marketing is a slightly different beast. Sure, you still see all forms of traditional marketing – TV, billboards, newspapers, bus benches, sign-spinners and yes, people still rocking sandwich boards – but the digital landscape has revolutionized everything.

Now, companies can reach consumers exactly where they are – at their fingertips – and their reach is global. 

So it comes as no surprise that according to a recent report, 95% of the organizations surveyed have increased their digital marketing budget in recent years, and 9 in 10 marketers expect their budget to continue to grow in 2020. 

More marketing-by-the-numbers trends and predictions for 2020?

• The U.S. Small Business Administration suggests spending 7% to 8% of your gross revenue on marketing. (Admittedly, we think this is too low. Twelve to 20% is our preference. Because of course it is.)

• 84% of C-level and VP-level buyers are influenced by social media when purchasing according to IDG. 

• 55% of B2B buyers say they look for information on social media.

• Nine out of ten B2B companies use LinkedIn. 

• More than half of B2B buyers have used LinkedIn to help them make a purchasing decision over the past year. 

• On average, live videos on Facebook and Instagram keep audiences watching three times longer than recorded ones. 

• Daily watch times for Facebook Live videos have quadrupled in a single year, and produce six times as many interactions as recorded videos.

But this then begs the question: How much should companies budget for 2020 and, further, how should they allocate it?

Allocating Your 2020 Marketing Budget 

WHO: The People

Think about who will internally lead your team and who you may need from an outsourced perspective to augment your internal team with focused skills and niche experience which align with your sales team and process. 

Consider these services and be sure to follow a good selection process:

Digital Marketing Agency: Content creation and optimization, online advertising creation and placement, email and nurture automation management, reporting and analysis 

Creative & Design Agency: Video production, designed marketing assets, achieving a cohesive overall brand and solid core company messages for segments of audiences

Development Agency: Technical website updates, site hosting, and new site functionality

PR Agency: Media outreach, event coordination, and internal and external communication strategies along with crisis communication

HOW: The Tools

Considering that marketing software can save hours every day through automation, it stands to reason that this is a reasonable budget designation. In fact, Garter reports that marketing technology is the top expense – and we’d support that it’s one of the most important line items – in a marketing budget. Marketing technology should average about one-third of your marketing budget and should increase year over year. 

Here are a few – of the many – digital marketing technologies to consider for your 2020 budget. Most have paid and free versions, with different levels of functionality, so it’s important to know what you need, what’s working and what’s not so you get the most bang for your buck.

• CRM (customer relationship management) software: We like Hubspot, Salesforce, Zoho. Sales teams usually have a strong influence on this selection.

• Marketing Automation: Hubspot, Marketo, Pardot in conjunction with email marketing

• Email Marketing: Hubspot, Mailchimp, Constant Contact

• Social Media Scheduling & Listening: HootSuite, Hubspot, SEMRush, Sprout Social

• Reporting Aggregators: Google DataStudio, Bizable, Dataroma

• SEO (search engine optimization): SEMrush, Google Keyword Planner, Moz

• CMS (content management system): Wordpress, Squarespace, Hubspot

WHERE: The Placement

Before budgeting media dollars, ask yourself: What are my goals? Who are my customers and where are they? Because whether you want to raise awareness or increase sales, a more thorough and strategic outline of these foundational questions will decrease your media waste and help you find the sweet spot of where to spend your media dollars and what to say in your advertising. Not to mention with proper tracking in place, you’ll get to a customer acquisition cost a lot faster. 

These are the top-three places we like to advertise, though the options are wide.

Social Media: Each network offers different placement and pricing opportunities to discover and test – making no assumptions – with guidance on audience size of your desired target, along with suggested budgets for those audiences. And remember that social goes beyond Facebook and LinkedIn as you may need to explore others – such as Twitter, Snapchat, YouTube, and more – if that’s where your audience is.

Display Ads: Maybe you prefer to work within a network of partner websites or buy directly on individual sites. Or maybe you prefer to buy banners via the Google Display Network. Many offer a cost-per-click – price per 1,000 impressions. Compare it to what Google offers for the same target audience and budget accordingly. 

Search Ads: While organic search optimization takes a lot of time, search ads allow you to pay your way to the highest ranks of search engines. And don’t forget that while Google rules market share as a search tool, Bing, Yahoo! and others shouldn’t be completely ignored. 

OTHER: Events & Bit-and-Pieces

There remain two marketing budget line items: events and the cost of odds-and-ends, like business cards, printed collateral and other such miscellaneous items.

Events: Many companies forget about event marketing in their budgets – but many events can be the cost of doing business rather than a marketing cost. So events – think: trade shows, conventions, conferences, and more – are opportunities to engage with your customers genuinely and directly. You’re humanizing your brand – and that often proves priceless.

Bits-and-Pieces: These are the expenses you will incur that don’t fit neatly into any of the above categories in your marketing budget – but you’ll likely have line items for – like philanthropy, sales materials, giveaways, business cards, and more. They have to go somewhere – and that somewhere is your choice in line item designation.

Granted, budgeting isn’t the sexiest part of running a business but taking the time to properly and thoughtfully allocate your 2020 marketing budget the right way can fatten your bottom line next year. And that is decidedly sexy.