Budgeting for Advertising - How Much Should You Spend?
Whenever we bring up the topic of digital advertising we always get the same question, over and over again. How much does it cost? This is a tough one to answer. Knowing how much to spend on your digital advertising is really dependent upon your business, time of year, and frankly, what you have to spend. The great thing about digital? Even the smallest budgets can succeed online, which is especially helpful for small businesses that are priced out of the more traditional options, like newspaper and TV. We've pulled together some basic guidelines on what you should be prepared to spend if you really want to start seeing your online ads make a difference for you. Again, remember these are just general guidelines and should be adjusted to fit what you find works best for your individual business (testing is always important).
The big kahuna. The main one. The platform everyone wants to be on. With an estimated 33.76 BILLION (that's right, billion with a "B") expected to be spent on Facebook ads in 2017, both local and national advertisers alike know that this is the place to be. However, with so many options available it can be hard to know exactly what you should be spending on each of the different types of campaigns.
- Like Campaigns - While guaranteed to get you likes, it can be a little hard to know if the people liking your page are truly interested in your business. Keep these budgets small, starting around $50 for a 3 or 4 day run. See how they perform and go through the list of who liked your page to see if any seem "off" or "spammy". Then wait a few weeks to see if engagement has gone up or these new likes are paying off.
Total Spent Per Campaign: $50, Expected Cost Per Like: $1
- Boosted Post - Again, jury is out on whether these are effective or not so keep the boosted posts to only those things that are truly important. Limited your boosting to your own fan base can be beneficial to ensure you reach all the fans that you just can't get to relying on organic reach alone. Save targeting people outside of that existing fan base (those that already like your page) for a more traditional FB advertisment.
Total Spent Per Boosted Post: $10-$30
- Advertisement - For more traditional advertisements (whether they be static image or video ads) start small here and gradually increase your budget over the course of a few days. Studies show that throwing large amounts of money at your ad off the bat actually ends up costing you MORE per lead in the long run. Another benefit of this strategy is that you can test different ads and target groups slowly with less money and then increase spend on those that you find are working for you. Plan on hitting a target of at least $30 to $40 per day (this can go up to hundreds of dollars per day if your budget allows) and being about to sustain that for a minimum of 5-7 days to really see ad impacts.
Total Spent Per Campaign: Start at about $10-$20 per day, Slowly increase in $5 or $10 increments daily depending on overall budget and time of campaign.
Expected Cost Per Lead: $3-$5
Another Facebook owned platform, Instagram is quickly being indoctrinated into the FB advertising fold. While they haven't touched algorithms around what's appearing in Instagram newsfeeds (yet), it's getting harder and harder to reach new users and followers without the use of ads. If you're adding Instagram ads on to Facebook ads (which you can do right through the Facebook Ads Manager), plan on following a similar budget and strategy as your Facebook ads.Total Spent Per Campaign: Start at about $10-$20 per day, Slowly increase in $5 or $10 increments daily depending on overall budget and time of campaign.
Expected Cost Per Lead: $3-$5
Ahh Pinterest! The underappreciated and underutilized advertising platform, for small businesses especially. With the common misconception that Pinterest advertising is way too expensive and out of reach, not enough small business are jumping on this bandwagon. But we're here to tell you, it's WAY more affordable than you think! There hasn't been any evidence of needing to "start small" in Pinterest like you do in Facebook, but if it's your first time running ads on the platform it's always better to try testing with a smaller budget first to see if it's something that works for you. Plan on about $20-$30 per day (but feel free to go up from there) and about $100 - $500 per campaign.Total Spent Per Campaign: $100 - $500, Expected Cost Per Click: $.25-$1
Google Adwords
Once the king of all online advertising, competition is fierce. Google is THE search engine with the majority of searches done within it, it's no wonder advertisers are clamoring to get their brand in on it. However, with this one we like to say, “buyer beware!". While it can be effective, it's taking increasingly more and more money to outbid competition. In addition, users are getting very savvy to knowing what are "ads" and what is real, organic content. Latest studies show that about 60-70% of people searching tend to skip past the ads altogether and jump right to organic search. Good news? 30-40% of people are still clicking so there is still value in the platform, just be prepared to expand your budget.Total Spent Per Campaign: $500 - $5,000, Expected Cost Per Click: $2-$15+