A Detailed Guide to Budgeting for Digital Marketing

Digital marketing budgeting guide

Table Of Contents

Here are some ideas on how to divide your financing to obtain the most ROI if you're having trouble deciding how to effectively invest your digital marketing budget.

What should the structure of your digital marketing budget be?

Your digital marketing and advertising budget will be determined by a few elements when determining your overall marketing budget for the future year. These include the type of business, its size, how long it has been operating, and its goals. Start by examining your company. In order to compete with your rivals, you must make sure that your money is spent in accordance with business leaders.

Your company size will be the next consideration when determining your digital marketing budget. There is a significant likelihood that the majority of the revenue can go toward your promotion budget if your business is bigger and generates more money. You'll probably be a little less lenient with your financial strategy if your business is smaller.

To determine what technologies and digital marketing services could be needed, you should conduct an audit using the steps below.

Draw Data and Set Objectives

You should look at your present data and establish some goals before dividing up your spending for digital marketing. So that you have something to compare your present performance to when evaluating the success of your internet advertising activities, pull benchmark data from it. Don't forget to consider your prior marketing initiatives. Find out which platforms have succeeded and which have failed so you don't repeat your errors. Additionally, examine how much money you've previously spent on marketing.


Your reputation is everything. Your business will attract devoted customers if you establish a consistent brand presence across your website and marketing materials. It makes sense to allocate your marketing money such that it can support your advertising. Running branded adverts, remarketing campaigns, connecting your company with industry influencers, investing time and money in optimizing your website, and keeping all promotional materials unified are some ideas for doing this.

Paid Advertising

PPC is a crucial additional area where your digital marketing spending must be spent. You should divide your advertising budget between social media ads and Google Adwords depending on your overall budget and the best strategy to reach your target demographic. Google Adwords ads may include search ads to grab clients' attention as they look for solutions or remarketing ads to keep your brand at the forefront of their minds.

divisions of digital marketing budget

Advertising software

You should first evaluate modern advertising and marketing computer software when deciding where to allocate your marketing money. Both large and small businesses can benefit from a variety of programs that can help you focus your marketing efforts and the way they generate new leads and revenue. A few marketing software programs to take into account are:

  • Mailchimp
  • ActiveCampaign
  • Hubspot
  • SEO

The second area to which you must allocate funds for digital marketing is SEO. The strength of your website's optimization depends on how captivating the website copy is and whether it is easy to find. Long-term SEO investments can be profitable since customers continually find and return your own content.

Social Media

If used appropriately, social media is still as crucial as ever. The likelihood is that social media influences your target audience in a totally different way. You must think about putting some of your advertising budgets into a social networking plan after deciding where and how much money you will devote to social advertising.

Email Marketing

Email marketing should be your last destination for your digital marketing expenditure. To move leads through your sales pipeline, targeted email routines are essential. Sending one-off emails with no accurate follow-up or consistency, however, is no longer as successful. A well-planned email marketing approach will start to pay off for you right away. Email still merits a place in your marketing budget.

Here are 5 steps to help you determine your budget for digital marketing.

Save money on digital marketing with this free tool.

In order to construct this template, Deloitte used data on industry benchmarks. But also keep in mind that we're not accounting experts—we're digital marketing nerds. Even for businesses in the same vertical, there are still a lot of factors that could have an impact on the end result. For instance, a company with history may have greater brand recognition or an organic online presence, which may make them less budget-reliant than its more recent competitors.

Establish Your Projected Income

Based on your historical performance and annual growth plans, this is easy to understand for more established businesses. Forecasting this amount can be a little more difficult for startups. Predicting two distinct scenarios—one more bold and one more conservative—is often optimal.

Choose an Industry

Your budget will be adjusted in light of what other players in the region are spending. Although there will undoubtedly be differences across businesses in the same sector, this is a great method to find your benchmark. This last element will match the recommended distribution in your financial plan.

Choose a business model

You can view the supply of your budget by overall marketing actions as well as digital marketing and advertising actions in the Investment Summary table that follows. Some brands prioritize online activities above offline ones and vice versa. Digital advertising, however, is essential for new companies and start-ups since it has a lower entry barrier than traditional marketing strategies.

Convert this count into a digital marketing plan

You may see a thorough breakdown of your digital marketing budget in the final table. Your Media Spend is listed in the table's first section. You may roughly expect to invest that much money in paid media channels like paid search, paid display, and paid social. The organic digital marketing channels, including SEO, Content, and Analytics, as well as the planning and research necessary to keep these strategies in use, are covered in the second section of the table.

Final Remarks

No two businesses are precisely alike. What may be effective for you may not be appropriate for another. Therefore, our digital marketing budget calculator is meant to serve as a reference rather than a strict rule.

Furthermore, it's critical to keep in mind that reality and predictions frequently diverge. Our financial objectives are sometimes missed and other times exceeded. One of the best things about digital marketing is that it allows us to be entirely flexible with our approach. With just one click, we can change media spending, halt campaigns, or open up new markets.

Contact Prism Digital, an award-winning digital marketing agency in Dubai, if you are the owner of a startup or an established company and would like to work with a company that specializes in helping businesses grow online.

Lovetto Nazareth

About The Author: Lovetto Nazareth

Lovetto Nazareth is a digital marketing consultant and agency owner of Prism Digital. He has been in the advertising and digital marketing business for the last 2 decades and has managed thousands of campaigns and generated millions of dollars of new leads. He is an avid adventure sports enthusiast and a singer-songwriter. Follow him on social media on @Lovetto Nazareth

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