It’s widely accepted that B2B and B2C customers, in all sectors, are spending increasing amounts of their time looking at a variety of screens, rather than hard copy paper formats.
Today, a thick business telephone directory is more likely to be seen being torn in half by a circus strong man on YouTube, than sitting well-thumbed on the office manager’s bookshelf.
Your customers’ options are now just a click or tap away, and modern, direct, digital sales and marketing activity can be personalized, automated, and highly-targeted in terms of individual customer preference, geographic location and even mood!
The multichannel world we live in is one where customers are interacting with brands across a wide range of touch points both on- and off- line. Whilst you’re probably investing in digital to some extent, how do you know if you are over- or under-spending?
Numbers relating to the average digital marketing spend – as a percentage of marketing budget – vary considerably, and the appropriate level of investment will of course vary from sector to sector and from business to business. However, there are certain levels of investment, below which, you may well be falling behind the competition and missing out on opportunities.
We’ve developed a very simple rule of thumb to help you find out if you are in danger of under-investing. It’s called the 20:20 formula …. 20% of your marketing budget should be spent on digital and 20% of that on planning your digital activities. Our experience and research suggests that organisations investing less than 20% of their annual marketing budget in digital channels are in danger of losing out to competitors who invest more. And that number is going up, not down.
What percentage of your annual marketing budget was invested in digital channels last year?
Did you invest that money wisely?
As the military saying goes: time spent on reconnaissance is never wasted. Digital remains the fastest growing marketing medium in history. 90% of the digital data created by the human race was created in the last 2 years. It’s a very fast-moving medium and few marketers have the time to remain abreast with emerging trends and user behaviour patterns online.
It pays to invest some of your digital budget on research and expertise so that your strategy, plans and tactics are based on insights about your target audience and how they prefer to interact. Hunch, gut feel and instinct are all very well but they become immediately less valuable when you are asked to explain the failure of a campaign to your board!
It’s also vital to set key performance indicators (KPIs) and measure success to learn what worked and what didn’t, to inform future strategy. Again, our research suggests that organisations spending less than 20% of their digital marketing budget on expertise, research, planning and measurement are in danger of investing unwisely.
What percentage of your annual digital marketing budget was invested in external expertise, research, planning and measurement?
So … If you have an annual marketing budget of £1m, you should be spending at least £200k in digital channels and £40K of that on external expertise to ensure that it is well spent.
For a free consultation with one of our Seniors please click here.
This post was written for Blue Latitude by Marketing Coach and Pitch Guru Mark Walmsley
Sign up to the monthly newsletter to receive the most relevant Pharma Marketing news, reports, webinars, videos, and practical tips to help you create and maintain more profitable relationships with your customers. Be the first to receive Blue Latitude’s insight and expert advice.