Recent studies reveal that the social marketing budgets of many companies are rapidly increasing. This is true even if the company is struggling to demonstrate that these efforts are positively impacting its business.
On average, approximately 9.5 % of the company’s marketing budget is spent on social media promotions. It has been projected that this number will grow to around 13.2 % within the next year. Within the next five years, there is a projected increase of 21.4 %. This represents a 128 % increase, largely based on the insight of chief marketing officers that bold opportunities wait in social media.
How to Determine the Complete Marketing Budget
Your overall marketing budget is obviously the source from which the social media marketing budget is taken. So-called experts offer recommendations that are technically sound but completely non-actionable. These include statements like “Your marketing budget could be dependent on your business size, how long the business has been in operation, the type of expenses accrued and the profitability of the business.” “Your budget will largely depend on the marketing needs of the company.”
These are merely vague generalities that do not consider the existence of discernible patterns in social media marketing. Studies indicate that businesses that gross an annual revenue of over $25 million spend around 9 % of this revenue on their marketing efforts. On average, companies that earn under $25 million typically spend 11 % of their revenue on marketing. As such, 10 % has been deemed the “magic number.” While, there are other variables that affect the amount dedicated to marketing, the most common marketing budget was found to be roughly 10 %.
Therefore, the issue now becomes figuring out the portion of that 10 % that should be solely dedicated to social media marketing.
How Much Does Social Media Marketing Cost?
It has been found that, on average, the monthly cost of social media advertising is between $4000 and $7000. This is between $200 and $350 per day, which is an incredibly high cost.
There is an average monthly cost of $2000 to $4000 per month to create a Twitter account from scratch. It was revealed that a number of businesses pay an average of roughly $1000 and $2500 monthly to reorganize and revamp an existing Twitter account. To set up and operate a Facebook marketing account, PR agencies collect, on average, a monthly fee of $2500 to $5000.
There is an average cost of $4000 to $7000 to formulate and create a social marketing strategy with two or more social networks. It could run you between $2000 and $10000 to have your existing accounts audited and get recommendations.
What You Spend Will Be Determined by How You Spend
The previously outlined costs are way outside the budget of many small business owners. This is particularly true when it is considered that the listed prices exclude the cost of content. Establishing a truly inclusive and effective presence on social media is tremendously specialized, time-consuming and tedious. This makes it impossible for most business owners to take on the task.
Among these tasks is managing social media pages, which typically includes monitoring 2 to 3 Facebook posts and 7 to 10 tweets daily. It also involves writing and editing multiple pieces of content to use as blog posts. Additionally, it is important to monitor keywords, check hashtag alerts and ultimately increase the number of relevant followers. Furthermore, companies that can afford to place paid ads are required to work on areas like ad creatives, ad optimization, measurements and analytics.
Highlighted below are benefits of handling social media marketing on your own, hiring a small marketing firm and hiring a corporate agency:
In-House Social Media Marketing
One of the advantages of handling social media in-house is that business owners can control their workflow and schedule without making a significant investment in time or training costs.
Hiring a small marketing firm costs between $400 and $1500 month. These firms specialize in catering for small businesses. Typically, they have a number of price options and often, their services can be written off during tax season. Similar to freelancers, small digital marketing firms do not require payroll or benefits. It is also less expensive than hiring an in-house manager.
Corporate Marketing Agency
This is only feasible for the biggest and most well-resourced companies as it costs a minimum of $20,000 per year. These agencies have a large staff with responsibilities that involve establishing sophisticated long-term social media campaigns.
This isn’t a hard-and-fast rule regarding a particular amount to spend on social media marketing. However, there are smart strategies available to help you to identify priorities and wisely divide your budget on the most important components of your social media campaign.
The service ultimately chosen will depend on your social media budget; however, the budget is not the only determining factor.