Webinar recap- How to Budget Your Search Marketing Program

As the last quarter of the year creeps closer, compiling your budget for 2012 is high on your to-do list. This is the perfect time to set aside dollars for your search marketing plans and strategy preparation. In today’s SEM webinar, we focused on uncovering best practices to optimize the spend for your unique budget, how to designate your spend between paid and organic marketing efforts, and how to build a CEO-friendly reporting model to justify your costs.

Let’s drill down into a few main elements that we discussed today in our webinar session:

Q: What does the allocation of B2B marketing budgets look like?

A: According to a MarketingSherpa study, the largest segment of budget goes to website design, management and optimization. Next, tradeshows account for a significant slice of a marketer’s annual budget. It is interesting to note that traditional marketing “musts” like tradeshows are given similar attention and budget allocation as email marketing with search engine optimization (SEO) and paid search (PPC) close in step.


Q: What does the allocation of marketing spend look like in the retail industry?

A: In the retail industry, companies like Walmart may spend a meager 0.4% of sales on advertising. The sheer size of Walmart turns this seemingly tiny percentage into a significant budget. Walmart’s higher-margin competitor, Target, spends closer to 2% of its sales on advertising and marketing. More upscale stores like Macy’s, Bloomingdale’s, and Nordstrom typically attribute 5% of their budget to promoting luxury items and more expensive apparel.


Q: How do service businesses designate their spend?

A: For businesses that specialize in services, it may be beneficial to set your starting point higher than 5% of budget. For example, if you are a professional services firm, you are more margin-oriented than volume-oriented. This means that fueling growth requires more budget spend at a higher percentage of revenues. In particular, young companies must invest more heavily to build their brand in the early development stages. Sometimes this could mean putting down 8-15% of budget or even upwards when it is warranted.


Q: What factors will contribute to the growth of online marketing spend?

A: Over the next 5 years, digital marketing is going to continue to grow at a rapid rate. The most important factors contributing to our digital evolution are:

1. Larger digital marketing teams: Marketers now have larger staffs to work on online projects than in previous times. This allows for further creative and technical program expansion.

2. Excitement about emerging media: Compared to years in the past, marketers now have increased budgets to spend on social, mobile, video, and other elements of new media.

3. Effectiveness of digital media: Marketers have seen digital marketing efforts generate better results over time and now, we can measure everything. This includes social media and realizing your return on engagement (ROE).

4. Changing customer conversion path: Making and tracking multiple touch points are now required across traditional and new media channels. Instead of the linear conversion funnel, marketers are now focusing on the defining and closing the customer loop.


Join us next week to continue your strategy preparation for the end of 2011 in our webinar: Tune Up Your SEO Strategy with 5 Tailored Tips for Q4.

If you would like to speak with one of our digital marketing experts to set up an Ad Audit or Site Analysis for your business, please contact us atseo@webmarketing123. We would love to learn about the challenges you are currently experiencing and what you’d like to learn more about when it comes to optimizing your current search marketing initiatives.



Genevieve Waldron