A new year is especially important for digital marketing teams as it’s a time to evaluate the newest trends, draft strategies that deliver optimal ROI, and define the budget dedicated to digital marketing. Marketers must come up with a roadmap rooted in sound reasoning and based on concrete data.
They must evaluate the factors that drove conversions in 2019 including the type of messaging, the demographics of their audience, and the touchpoints. Since no organization has limitless resources, defining a budget for your 2020 online marketing campaign is essential. Here’s a look at how you can do that effectively.
1. Most Profitable Traffic Sources
Many websites will receive visitor traffic from a wide range of sources since consumers have diverse channels through which they can get to the site. To make sense of this traffic, a powerful tool like Google Analytics can help disaggregate it by showing how consumers arrived in specific web pages.
The traffic sources you’ll see include organic (non-paid) search traffic, paid search traffic (from users who clicked through pay-per-click (PPC) ads), referral traffic (e.g. from review sites, press release sites and news sites), social media traffic (from platforms like Twitter, Facebook, Instagram, and WhatsApp), email traffic (from email marketing campaigns) and direct traffic (from persons who entered your URL into their browser).
Depending on the size of the site and the number of visitors, the volume of traffic data can be overwhelming for enterprises that don’t have persons dedicated to looking at it. In this case, it may be necessary to work with not just a third-party tool like Linkio but also a digital marketing agency that has the requisite experience and expertise.
By extracting detailed information on the channels that have been most responsible for click-throughs and conversions, businesses can gain a better understanding of what channels are most responsible for their growth and thereby dedicate more digital marketing budgetary resources to them.
Knowing where traffic primarily comes from lays the foundation to delve into the details of who is visiting the site which is the next point.
2. Uncover Audience Demographics
The success of a digital marketing campaign greatly depends on having a deep understanding of your brand’s audience as this determines the portals to leverage, the type of messaging to employ and virtually every other facet of the campaign. Without an intimate understanding of your audience, there’s a risk that a substantial proportion of your digital marketing will be going towards irrelevant, uninterested consumers who will never convert.
Ergo, sellers must use the data at their disposal to discover the exact nature of demographics that will accelerate their growth. Accessing this data on Google Analytics requires that you enable the demographics and interests’ reports. Once enabled, you’ll see your audience’s ages, genders, interests, and affinities. Establishing your business’ most fervent customer segments is necessary to prioritize your digital marketing in a way that maximizes growth.
3. Contrast ROI for SEO and PPC
Understanding how much you spend on search engine optimization, content marketing, social media advertising, display network advertising, and email marketing, as well as the revenue received from each channel, is vital for scaling the business. Calculating the ROI of each channel is necessary to prioritize your budget.
Calculating basic ROI is easy and entails subtracting revenue from cost, dividing the result by cost and converting it into a percentage value. Nevertheless, while this formula will provide a number you can work with to optimize your marketing spend, there are more complex ROI formulas that incorporate other factors such as labor. In addition, there are various ways to determine revenue from marketing efforts. You could look at the sales directly attributed to the channel within the year or include the long-term multi-year revenue from a customer who converted based on a given channel.
Irrespective of the formula you use, conversion tracking is essential. Running a conversion report on Google Analytics will show what conversions came from organic search, paid search, social media and so on.
While these three steps are important in getting your digital marketing budget right in 2020, it’s important that you keep an open mind in the understanding that what worked in 2019 may not necessarily be as successful in the new year. The marketing budget isn’t static and should be revised and adjusted as needed throughout the year depending on new data that comes to light.
The original version of this article was first published on V3Broadsuite.
- 3 Tips for Preparing Your 2020 Digital Marketing Budget - January 21, 2020