If you aren’t marketing through social media, then you are committing a CRIME. Here’s why –
- Social Media Marketing helps in increasing engagement even if you have a small marketing budget.
- There are over 3.6 billion people who spend approximately 145 minutes per day on social media! This tells us that you will be able to reach more people than regular advertising methods.
- Reaching out to more people will automatically increase your brand awareness.
- Create better leads to make contact with potential customers.
- Your customers will know about new products or services you launch well in advance! This will ultimately lead to an increased sales.
Having said that, you must devise a strategy to create a social media budget to ensure you reap all the benefits mentioned above. So how much should ideally be allocated to your social media budget? You will be able to find that out as you read further into this article. The methods mentioned will help you even if you are a small business with smaller funds to allocate for social media advertising.
Before venturing further into this article, you must remember that the budget allocated to social media tends to vary across sectors.
What factors are bound to affect your social media budget?
There are a variety of factors that affect the social media marketing budget. Some of them are –
The size of your company
Companies with a larger number of employees have the luxury to shell out a smaller amount of money on the social media budget in comparison to a smaller company. That could have something to do with the fact that a bigger company is bound to have a fan base already.
Your industry, whether it is retail, IT, or any 0ther
Almost all companies today splurge on social media marketing, but none come close to Retail companies.
Is your marketing management going to be outsourced or in-house
Your costs will be higher if you hire people as apart from a base salary, you will also pay out benefits. If you outsource the content, there are chances you work with a company that provides you with a team of people. In short, you end up with your mini-marketing team and a meager amount for it.
The type of advertising you want to initiate
The tools or software you use
Sophisticated software is required for video and image editing, hosting, general content management, and SEO keyword research. Usually, Adobe Final Cut Pro is required for video editing, Photoshop lightroom for image editing, and Hootsuite for overall content management are used.
Setting a short time and achievable goal should be your starting point. If you allocate a budget without knowing your goals, you may not be able to allocate the right amount. One of the best ways to set new goals is by checking out previously set goals and allocated budgets to set new goals accordingly.
Analyze what helped you achieve those goals and which strategies worked best for you. It will help you know whether you should be increasing or decreasing resources. You will now be able to direct funds in the right direction.
The kind of content you wish to put out
Content is key, and you cannot skimp on its creation. To allocate the right budget towards content creation, you must know what will be involved. Below are mentioned line items that are usually a part of the content creation process –
- Images, photography, and video
- Talents ( models or actors)
- Location, rentals, and other props for background
- Copywriter for scripts and captions
- Editing and graphics for video or images
The cost of your content depends on how customized you want it to be. If you aren’t concerned with customization, you can use free stock photo websites like Adobe Stock Images, SplitShire, Pixabay, and Freestock.
If you are a brand that sells specific products (like jewelry, dinnerware, or clothes) and wants to put up images or videos that are funny and creative, you will have to hire a professional to do the job. It is also important to mention that hiring a professional will ensure you can maintain your brand value.
How much to spend on social media?
According to webfx.com, brands spend anywhere between $200-$350 daily on social media marketing. It brings the monthly spend to $4000 to $7000! WOW! So how much should be your approximate budget?
What is your general marketing budget
Usually, anywhere between seven to eight percent of the gross revenue is dedicated to a company’s marketing endeavors. For example, if you make about $3 million in gross revenue, $210,000 would be your marketing budget.
What percent will be allocated to social media alone?
Most companies direct 35% – 45% of the yearly budget to digital marketing and further allocate 15-25% of this budget to social media marketing. You could also go lower and direct 13% of the total marketing budget towards social media.
For example- let us take in the previously calculated $210,000 and calculate 13% of this amount. You will get $27,300, and this shall be your social media budget.
Is this amount small? DEFINITELY! But if you are a small business, then this is a healthy amount, and you will easily be able to get a lot done with it.
You can also calculate your social media budget by filling out the social media budget template below.
Your costs in this table have been divided into 5 categories, further dividing the categories into in-house costs or outsourced costs. It will also help in calculating the –
- percent of line items in each category
- percent of each category out of the total budget
This will aid in understanding where you have spent the most. Now let’s analyze this chart!
In the content creation category, write down how much you are paying your employees or the hourly rates ( or cost per project ) of the company you have outsourced the job to.
In the social advertising section, you will have to mention the outsourced costs for each social media platform ( like Instagram, Twitter, Facebook, etc.). Here you will be mentioning everyday costs.
The social engagement category includes per-channel costs of contractors or employees that respond to messages and comments on posts. This cost cannot be planned in advance and completely depends on the activities per day.
In software/tools, a mention of the money spent on apps that monitor social media and automation of posts. You could use tools, but they rarely provide the exclusive services paid apps do.
The promotion/contents section should have clear mentions of costs for discounts or prices you will provide. Also, mention money spent on buying ”reach” on social media.
How to get the best out of the calculated budget?
To get the best out of your budget, you must have already set your goals. For example, you want to hire a copywriter for blog posts or a videographer to create videos for social media. Such goals will have to be planned as you will have to splurge!
Feeling anxious about your set budget? then follow these tips-
- Record the analytics by checking out which type of content gets the most attention/attraction by the audience.
- Conduct market research to find out where your audience spends the maximum time. This way, you won’t spend too much on advertising. It will also help you track the latest social media trends so that you can create appropriate content.
- Outsource content because, YES, it is cost-effective. If you are outsourcing, then ask the company if they provide engagement apart from just content posting.
Budget allocation can be a tough task but keeping the methods and tricks mentioned above in mind, will surely aid you in creating the best plan. Once you have developed the plan you would have a clearer picture of the ROI (Return on investment) and make necessary changes.
Through these budget allocations methods, you will also be able to find out what could be included in your social media budget.