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Video Summary

Have you ever wondered about the magic behind successful digital marketing? It’s not just about crafting compelling blog posts or creating eye-catching infographics. No, there’s another important piece. It’s the often underestimated, sometimes overlooked hero of marketing – the budget.

Allocating resources for your online marketing endeavors is like planning a road trip. You wouldn’t embark on a cross-country adventure without a map, right?

In the same way, navigating the vast landscape of digital marketing requires a well-thought-out budget as your trusty guide. And today, you’re in luck, because whether you have a startup or a larger enterprise, I’m giving you insights and numbers to consider.

Video Transcript

Hello, my name is Jeffrey Kirk.

Allocating resources for your online marketing endeavors is like planning a road trip. You wouldn’t embark on a cross-country adventure without a map, right?

Why Does Digital Marketing Even Matter?

Well, we’re living in an era where the click of a button transcends geographical boundaries, where trends go viral in seconds, and where your audience is just a hashtag away.

If your business is not part of a digital conversation, you’re missing out on a lot more than just clicks and likes; you’re missing out on potential customers, growth, and a chance to expand your brand’s digital footprint.

In a world that’s practically living online, digital marketing isn’t a choice anymore; it’s a lifeline for businesses aiming to thrive.

Whether you’re a startup with ambitious dreams or an established enterprise looking to adapt, your online presence is a window to the soul of your business. And the resulting narrative should resonate in every pixel, post, and ad.

Let’s start with essentials. Every business, it doesn’t matter how big or small, should do these things in the digital realm:

Website Optimization: Your website is your virtual storefront. Make it user-friendly, mobile-responsive, and a true reflection of your business.
Social Media Presence: Engage with your audience on platforms that matter to your industry or profession. If your audience is there, be there too. If your business is small, just pick the best one. You don’t have to be everywhere yet.
Search Engine Optimization: If your website isn’t showing up when potential customers search for your products or services, it might as well not exist. You have to invest in SEO to climb the ranks of search engine results. If you’re just starting out, you don’t have to get into a monthly SEO program right away, but make sure the main pages of your site are optimized.
Email Marketing: Yes, email is still relevant. Use it wisely to nurture leads, keep customers informed, and even offer exclusive deals.
Create Valuable Content: Publish blog posts, videos, infographics—whatever is a good fit for your business. I often talk about the benefits of blog posts for business. Blog posting is a good way to start. Content is the currency of the digital world.

Now the big question:

How Much Should You Spend on Digital Marketing?

I’ve often heard businesses should allocate about 10% of their revenue to marketing. Realistically, sources say that an investment of 7–8% of revenue is good enough. But, here’s the catch – within that budget, around 30–40% should be dedicated to digital marketing.

Keep in mind that your business is unique so the numbers might change. You have to start by determining your goals. What are you hoping to achieve with your digital marketing efforts? Do you want more brand awareness? More website traffic? Lead generation? Your goals will influence your ultimate budget.

And, how important do you view the online marketing piece? Is 30–40% of your total marketing budget enough? Or is it time to give online marketing higher priority? It’s up to you and your business goals. Keep in mind that out of all the things you can do, one of the most magical forms of online marketing is content marketing.

According to research published at the Content Marketing Institute, content marketing generates more than 3 times the leads compared to traditional ad-based marketing and, on average, it costs 62% less. These are compelling numbers, but you also have to keep in mind that content marketing is a long-term game that gets more cost-effective the longer you do it.

For example, content becomes a good base for search engine optimization. But publishing a single optimized blog post one time isn’t going to do much, if anything, for your business.

It often takes 6 months to 12 months for a quality SEO program to start getting results. So you have to plan your budget with this in mind. And, probably consider other areas of digital marketing as well.

Creating Your Budget

The first step with creating your digital marketing budget is to evaluate where you’re at now. What are you spending already? How is that working for you? What’s good? What needs to change? It can be helpful to identify gaps and optimize your strategy for maximum impact.

And then, as you move forward, regularly check and adjust your strategies to stay ahead.

Now, let’s break down digital marketing budgets for businesses of various sizes. I’m going to give you guidelines based on businesses ranging from $100,000 in annual revenue up to $10 million. The assumptions I am making in each case is that a business will spend 7 to 8 percent on marketing. And of that total number, 30 to 40 percent will be designated as their digital marketing budget.

You can choose to stick with a budget that fits your exact business size, or you can base your total dollars on the next size up to encourage growth.

1. Businesses with $100K Revenue

The smallest business I am considering is a business with, or aspiring to, $100 thousand in annual revenue. With a recommended marketing budget of 7–8%, this gives a total budget of $7,000 to $8,000 for the year.

For digital marketing, consider allocating 30–40% of the total marketing budget. This results in a digital marketing budget of $2,100 to $3,200. That’s $175 to $267 per month. That’s not a lot! The good news is that there’s a powerful way to get you business-changing results with that budget.

SEO providers aren’t going to tell you this because they want you to spend more. But if you join me on an upcoming training webinar, I’ll show you how to get in the search results and even make a move on your competition while keeping your budget in this range or lower.

To see this training, go to upatdawn.biz/webinar.

2. Businesses with $250K Revenue

By allocating 7–8% of revenue to marketing, you would get an annual budget of $17,500 to $20,000. The digital marketing piece is $5,250 to $8,000 when taking 30–40% of that range.

As your business grows, online marketing becomes more important and, fortunately, slightly easier to budget for. At this point you should be spending about $435 to $665 per month.

So, if you have a small business and are not yet earning $250,000 per year, then consider spending at least $500 per month on your digital marketing, and allocate most of that to content marketing.

3. Businesses with $500K Revenue

With a half-million-dollar business, your marketing budget should be $35,000 to $40,000. That would result in a digital marketing budget of $10,500 to $16,000 per year. That’s $875 to about $1,335 per month.

This is the level where you can start making a bigger difference for your business with content marketing. As soon as you can, you should consider investing at least $1,000 per month on your content marketing efforts.

4. Businesses with $1M Revenue

Breaking the million-dollar barrier can be tough. Part of the process is to assign an annual marketing budget of $70,000 to $80,000. That means $21,000 to $32,000 should go to digital marketing. And that’s $1,750 to $2,667 per month.

At this level you start to move faster, picking up speed compared to competitors who are doing less.

5. Businesses with $2.5M Revenue

By the time you make it here, you should allocate $175,000 to $200,000 to your annual marketing budget. For digital marketing, you would have $52,500 to $80,000.

With a business of this size, your online budget breaks down to a range of $4,375 to almost $6,700 per month. Clearly $5,000 per month fits in this range. And that’s a number that opens a lot of content marketing doors and other digital marketing options.

6. Businesses with $5M Revenue

Even at just 7–8% of revenue, your marketing budget is getting large, being in the range of $350,000 to $400,000 for the year. And that makes $105,000 to $160,000 available for your digital marketing budget.

Now we’re talking about $8,750 to more than $13,000 per month. This gets you into some more advanced digital marketing areas including ongoing strategy, content, paid advertising, landing pages, email follow-up sequences, and more.

I’m not saying you couldn’t start those things sooner, but with a budget at this level, you’ve got money for all these things.

7. Businesses with $10M Revenue

This is the largest business I am considering here. You would have a total annual marketing budget of $700,000 to $800,000.

With 30–40% of that going to your digital marketing budget, you’re working with $210,000 to $320,000 per year. And this allows you to invest somewhere in the range of $17,500 to more than $26,500 per month.

What can I say? At this point you’re supersizing everything that’s been done before. Your biggest concern might become strategy. How do you overcome the competitor that is still ahead of you? Or how do you stay solidly ahead of any competition that might want to knock you down?

Okay, there you have it, a comprehensive guide to digital marketing budgets based on your business size. Remember, these are guidelines, not strict rules. Experiment, analyze, and adapt to find the sweet spot for your business.

If you found this video helpful, please give it a thumbs up, subscribe, and share it with your fellow entrepreneurs and business owners.

If you would like to go deeper and get better online results for your business, I would encourage you to visit my website at upatdawn.biz. I’d love to put together an online marketing plan that works for you at a budget you can afford.

Your business deserves to be seen online, and I will help you get there.

Thanks for watching and have a great day!

How To Calculate Digital Marketing Budget