How Much Money Should You Invest in Advertising?
Any entrepreneur will know that investing in an effective advertising and marketing strategy both online and offline is bound to pay off. Advertisements help to build your brand, increase its exposure to potential customers, drive traffic to your website, increase footfall in your store, and help you to turn a profit. But, when investing in marketing and advertising, how much should you spend? Are some advertising methods better than others, and can you get away with only using one or two effective methods and spending the least amount of money? These are all questions which business owners ask when planning an advertising campaign, and they’re certainly important ones.
Return on Investment Marketing
ROI marketing is a measurement tool to help you to determine how much you should be spending on advertising and marketing efforts. Using ROI to measure how much profit you make on a given marketing investment helps you to understand a few key elements of marketing, such as lifelong customer value, how much each customer earns you, and determining your marketing budget. When it comes to advertising, there is no right or wrong amount to spend, as it is personal to each company, and the amount invested in marketing can vary greatly between businesses and campaigns. Use ROI to figure out the amount you should be looking to invest in your marketing efforts.
Types of Advertising
When it comes to deciding how much is enough to invest in advertising, it’s important to consider the advertising type that you’re planning to spend money on. Some advertisements will generate more custom and interest in your business than others, and these are the ones that you should make a priority on your investment list. For example, email marketing may not generate much interest in your business, therefore it makes no sense to invest thousands of dollars in creating the perfect email marketing template and generating a mailing list. On the other hand, if your business has experienced massive success rates with social media marketing in the past, investing more in a professional social media marketing strategy and the help of experienced marketers will be a good investment that will likely help you turn a profit.
Determining Advertising Types
Before you decide how much to spend on different types of advertising, it’s important to determine which ones are likely to work for you, and which won’t. If you haven’t used certain types of advertising before, this can be a difficult decision to make and one which is rather challenging. Testing different advertising types before you invest can help you to gain an indication of their projected success rate for the future. For example, if you are considering using affiliate marketing, trying it first without investing a large amount of money is a wise decision. Once you have determined how successful affiliate marketing – or any other advertising strategy – is likely to be for you, you will have a better foundation on which to make your decisions regarding whether or not to invest, and how much.
Make Advertising a Priority
For many businesses, advertising tends to fall low on the priority list. Once other expenses such as payroll and accounting are taken care of, there is not often much left in the budget for advertising. However, what many business owners are forgetting is that effective advertising can help them to turn a larger profit by attracting more customers. In short, good advertising is essential in order for a business to grow and develop, and should definitely not be ignored – a fact that successful entrepreneurs such as John Lemp fully understand.
When working out your business budget, you should aim to include marketing costs, rather than simply leaving them as an afterthought once everything else has been paid. Even if money is tight now, making sure that you implement effective and meaningful marketing and advertising strategies will increase your business’ exposure and bring in new customers. Advertising doesn’t always have to be expensive, either – certain forms of marketing such as social media marketing can be done for free or at a very low cost, and are highly effective in increasing exposure, developing online presence, and attracting new customers. Generating new sales has never been easier thanks to the internet, and business owners don’t have to spend a lot to utilize the tools available to them online.
How much do you spend in an average month on marketing? Do you think it is important for business owners to prioritize advertising campaigns? We’d love to hear from you – let us know in the comments.