Budget, the second step in your digital communication

By January 25, 2018digital marketing

Budget, the second step in your digital communication


With the continued upgrade of technology and e-commerce in parallel, the growth of digital marketing sharply contrasts the decline in traditional marketing and is occupying more of a business marketing budget. This underscores the importance of this sort of investment to improve a business’s consumer reach. However, how much emphasis and resources should be poured into digital marketing so be carefully planned by a chief marketing officer. Digital marketing opens a door of competition against traditional media marketing which can be quite expensive. TV advertisements can be paid for in per-second terms. This is difficult to catch up with when it comes to small/medium-sized businesses. Once again, the era of the internet shows up as salvage to limited-resource business with modest marketing budgets.


There are basically four different options when it comes to using digital communications as a means of advertising:

Pay-per-click (PPC):

Also known as paid search or search engine marketing (SEM). Advertisements are shown to web users upon their search queries which retract relevant ads into their search result page. Costs of this type of advertising vary widely based on the competitiveness of the keyword being searched for. This form of advertising proves to be cost-effective since it basically targets clients who have already shown interest in the product as per their search query. Yet, it is very important for a business to avoid investing too many resources on pay-per-click agreements on a head-term (broad-term) keyword, the more specific the keyword is, the more relevant customers are likely to find the product.

Paid social media marketing:

Social media such as Facebook, Instagram and Snapchat are occupying more of the digital marketing efforts. Besides paying for a screen advertising area for a product or sponsored ads, there is a rising trend on vloggers (video bloggers) who offer different marketing packages (by video-length and number of appearances) to display short previews of a product. The outcomes of this type of marketing and how to it reflects on profits is rather volatile due to the entertaining nature of such social media that are casually surfed by everyone. In other words, this type of advertisement does not necessarily display in the face of potential customers interested in the product. Also, the cost of these advertising options varies significantly depending on the type of product and visibility to a particular community of potential customers.


marketing takes up between 7-12% of a firm’s total annual revenue


While marketing takes up between 7-12% of a firm’s total annual revenue, reports show that almost 40% of marketing budgets are allocated to online marketing purposes. In the process of determining the budget for each of these forms of e-marketing, it is important to inspect the market penetration associated with these platforms. Search engine marketing occupies the largest share of online spend. Social media advertising investments will continue to grow, expected to represent 25% of total online spending in 2018. Facebook reportedly has the greatest penetration of the market followed by Instagram, Twitter, and Snapchat, respectively.


Based on surveys of chief marketing officers, a budget calculator tool was proposed to help businesses determine their e-marketing budget taking into account the type of business (B2B or B2C), the total annual revenue and percent of the annual revenue generated online.

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Author David

Digital communication for freelancers.

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