I was recently speaking with the owner of a new company about his business plan and marketing budget allocation.
He wants to hit the ground running and as such has allocated a $1 million dollar ad budget for the first year, that comes out to a total monthly budget of around $83,000. Of course not every new business owner is lucky enough to have the working capital to launch with such a sizable budget, but when your budget is that large, how do you spend it?
The honest truth is that whether your monthly advertising budget is $1,000, $10,000 or $1 million dollars you have to go through the same thought process for determining how to spend your dollars.
Today I’m going to share with you what you need to do.
1. Decide what your goal is: branding, lead gen or sales.
Before you launch any advertising campaign you need to pick your goal. If you have a budget of $10,000 per month or more you can usually choose two goals to go after, which I recommend being branding and lead gen or sales in the case of e-commerce clients. However, if your budget is less than $10,000 you need to really focus on one thing, especially if your business is brand new or not well known.
If your company is new I almost always suggest using your budget on a branding campaign. This isn’t to say that you won’t get any leads or sales from your branding campaign (you probably will), but the main focus shouldn’t be on generating a return on your advertising spend (ROAS) other than increased awareness for your company, product or services.
2. Write out a 12-month advertising plan.
While it may be in your company’s best interest to spend money on branding at the onset, this doesn’t mean you should spend your full advertising budget on branding forever. I usually recommend focusing on pure branding for 1-3 months and then re-allocating part of the budget to lead gen and/or sales.
It’s best to take a tiered approach where you allocate a little more budget to lead gen or sales every quarter. As your sales start picking up you can invest more money into your advertising campaigns and begin increasing the amount of money you use for these campaigns even faster.
3. Determine which advertising channels to use.
Because my client has a $1 million dollar annual budget for advertising we are going to spread the money across a variety of different channels.
The first three months of his campaign is going to focus solely on branding and as such we are including traditional media outlets in the mix:
- Bus wraps
- Digital Radio (eg. Spotify, Pandora, etc.)
- Facebook Ads
If I was working with a small business owner who had a much smaller budget, I would likely recommend Facebook ads as the best branding vehicle and the one to put the majority of the ad budget in.
Facebook ads allow for incredibly precise targeting and the ability to design specific creative for different markets. For example, if you own a sports clothing brand you might create ads that feature the LA Clippers for your LA audience and the Miami Heat for your Miami audience. You could also simply make references to local places, roads, popular establishments and so on in your ad creative or copy to make an ad hyperlocal and therefore more appealing to a specific audience.
4. Track your results.
Whether you launch with a million dollar budget or you just begin by managing a Facebook ad campaign on a modest budget, you should be tracking your results, especially if you are running a Facebook ad a/b test.
You are probably already familiar with Google Analytics and know that you can track your website statistics and online conversions through this platform.
Did you know that you can also use phone call tracking to see how many phone call inquiries result from your online and offline ad campaigns? Using a software solution like Call Tracking Metrics you can use dynamic phone call tracking to get information like:
- Which ad campaign someone clicked into before calling you
- What organic search term someone used to find you
- Which landing page the person last saw before calling you
- How long the phone call lasted
- What was said on the phone call (the calls can be recorded)
Here’s an example:
With offline advertisements you won’t be able to receive all of the same data since no one is Google’ing or clicking an ad campaign to find you. However, you can assign a specific trackable number to your print ad, billboard, bus wrap, etc.
When you log into your call tracking dashboard you’ll be able to see how many people called you using each of your trackable numbers, how long the calls lasted and what was said on the call.
5. Optimize based on your results.
Once your initial month of campaigns ends you can review your results and decide how you want to move forward with your campaigns. If you discover that the billboards didn’t result in a lot of qualified leads or sales, but your Facebook ads did – that you should re-allocate budget from the billboards into the Facebook ads.
Getting to this point is the fun part because it’s where you finally see your hard work paying off!
After you have spent 3 – 6 months working on optimizing your current campaigns, you can begin introducing new ones … rinse, wash and repeat!