At least a handful of times a week I get asked the question, “how much should my inbound marketing budget be?”. It’s a great question, but one that does not have a simple answer. Setting a budget is much more complex than simply coming up with a monetary value and hitting the go button. Instead, the focus should be on setting an inbound marketing budget that can get results within your niche as well as aligns with your business’s timeline and needs. If you have $10,000 a month to put towards inbound marketing, that’s great, but is it enough? Could your results be comparable with a $5,000 a month budget? Though you ultimately do have to come up with a dollar amount, I would not recommend using it as a starting point. Instead, develop your strategy and then work towards a specific investment amount that’s going to get you the results that you need in the amount of time that you’re targeting.
Your Niche Impacts Your Budget
Over time, I’ve worked with a range of businesses from small geo-targeted B2C companies to global B2B companies. What might be surprising to some, is that a small geo-targeted business could actually require a higher budget to run a successful inbound marketing campaign. An example would be a hosted VoIP phone system provider that only does business within 45 miles of its office. The challenge for such a company is that when it comes to organic content and/or ads effectively displaying in search engines, they’re likely competing with major nationwide companies such as Vonage, Nextiva, Comcast, etc. These major players are typically going to have much deeper pockets and an entire digital marketing team dedicated to their inbound marketing efforts.
On the other side of the spectrum, an example would be a manufacturing company that develops ultra high-pressure homogenizers on a global scale. At first, the word “global” can seem rather cumbersome to marketers, but if you dig into this specific industry, you’ll see that the number of these manufacturers is limited. This typically means that driving leads through an inbound marketing campaign will likely require a lesser financial commitment. Understanding your competition within your niche is a key component when building an inbound marketing budget.
Your Timeline Impacts Your Budget
Another question that I get with nearly every prospect that I speak with is, “how long will it take me to start receiving leads?”. And my response is typically “how long do you have before you need to start receiving leads to make this a successful investment?”. The reason is simple. Different strategies have different timelines. If you need leads yesterday, you’re likely going to be a fit for a Pay-Per-Click (PPC) campaign. If you're able to dedicate more time to finding quality leads, a content marketing/SEO plan (which could give you a healthier ROI) might be a better fit. Understanding the timeline of your inbound marketing results is vital when building your budget.
Your Needs Impact Your Budget
Lastly, what does your inbound marketing funnel look like? Where is your funnel broken, or where would you like to make improvements? Is your website’s performance suffering from insufficient traffic? Is your website driving thousands of visitors a month, but converting at 0.5%? Every situation is different, but understanding what your needs are is the last main component of evaluating your inbound marketing budget. If you have a conversion problem, you might simply be able to redesign your website to increase your conversion rate. This could be more of a one-time project compared to a long term recurring investment that a website lacking qualified traffic would need to make. In order to sufficiently evaluate your funnel, you’ll likely need a marketing automation software that provides data driven analytics. This will allow you to monitor your website’s performance, and ultimately determine where you can better improve your inbound marketing efforts.
As a HubSpot partner we highly recommend HubSpot’s all-in-one software, because not only can you create and manage your entire campaign, but HubSpot also allows you to gauge your marketing efforts with quality analytics, and make adjustments that will lead you to success.
Once you've set your budget, feel free to download our FREE "Guide to Inbound Marketing Best Practices":
Topics: Inbound Marketing
