4 Essentials to Wring Results From Your Content Marketing Budget
Are you confident that your content marketing budget for 2016 is sufficient for your needs?
Or maybe this is the better question: do you even have a content marketing budget? In many companies, content marketing simply gets rolled up into the general marketing budget. This means that even if there are funds available, it may be hard to justify larger spends, request a budget increase or accurately calculate ROI specifically for content marketing.
In larger organizations, CMOs are more likely to have a dedicated budget for content marketing. According to recent research from the CMO Club, marketing budgets are on the rise in 2016, and content marketing is the primary area where this increase is being spent.
Because we're seeing this increased investment in content marketing (which incidentally, the Content Marketing Institute confirms), I thought it would be helpful to provide a primer on how to plan your content marketing budget for 2016 and beyond. Following are four strategies or considerations to keep in mind.
1. Consider budgeting by customer journey rather than by channel.
Perhaps the most common approach to budgeting for content marketing is to break costs down by the three primary marketing channels: owned, earned and paid. Allocating funds to each channel tends to make the most sense and may appear to be the simplest way to break down costs.
However, organizations are increasingly moving away from this model (which I'll outline in more detail below) in favor of budgeting according to the entire customer journey. According to the CMO Club, CMOs are finding it more effective to allocate costs in this manner: "[T]oday’s CMO is much more focused on investing across the entire customer journey from discovery to advocacy – with an understanding that journeys have changed dramatically."
So, what does this mean in terms of hard numbers? On average, marketing budgets are being allocated as follows: buying stage (21 percent), discovery stage (20 percent), learning stage (16 percent), trying stage (16 percent), advocate stage (14 percent) and use (13 percent).
The customer journey model you're using doesn't have to look exactly like this. However, it should be differentiated from a simplistic buying cycle (e.g., awareness, consideration, purchase) which doesn't take into account the post-purchase stage.
It should also be noted that you shouldn't be afraid to change direction mid-year, and pivot, especially when using a new budgeting model. According the the CMO Club, many CMOS are seeing the benefits of shifting focus as they see the success or failure of different strategies: "Marketers are testing the waters by experimenting across tactics and buyer stages. In a sense, they are initially putting bets on every horse at the start of the race, but leveraging agile approaches to reallocate resources to the leading “horses” mid-race and increasing their chance to win the day."
2. Allocate by channel.Another stream of thought is to budget for content marketing by a specific channel. When using this strategy, you may wish to allocate your budget among the following categories:
- Written content creation
- Graphic design for visual content
- Video production
- Content marketing tools and software
- Website/blog maintenance and updates
- Email marketing
- Social media marketing (planning as well as implantation)
- Content promotion and distribution, including paid promotion
- Monitoring services
- Webinars or other online events
- Staff costs: This includes invoicing and paying employees and freelancers
These items will of course vary from company to company. For instance, some companies utilize freelancers for content creation, while others manage this in-house. However, in general, companies will include most of these categories in their content marketing budget. Think of this like the 80/20 rule for content.
If you're looking to simplify the process, there are some great templates you can use to budget for content marketing, either monthly or annually.
Hubspot's content budget template
Hubspot's content budget template (above) will give you a great starting point, breaking down costs into the following categories:
- Publishing tools
3. Consideration: Attributing costs by channel isn't as easy as it looks.
Now, you may be looking at the list above and getting a sinking feeling. Here's why: Unless you have a dedicated content marketing department, the costs associated with each of these items often aren't easy to isolate.
For instance, marketing software can serve a variety of purposes unrelated to content, and staff salaries often need to be divvied up between various budgets (PR, marketing, customer service, etc.). Even if you can come up with a fair determination of where to allocate funds, you still need to figure out how to do this: By time spent on content marketing-related tasks? How exactly will you track this?
Most organizations tend to calculate labor/salary costs based on time spent on content marketing-related tasks, and software costs based on actual usage. Other costs can be much easier to figure out, like dedicated freelancer workers or tools purchased solely for content creation and promotion.
4. Know what other organizations are spending on content marketing.
Sometimes it can be helpful to know what other organizations are spending, and how this compares to their overall marketing budget. Here are a few stats and facts that might help.
According to the Content Marketing Institute, approximately 28% of B2B marketing budgets are being allocated to content marketing; and this number goes up to 32% for B2C companies. If you want to be even more effective at content marketing, considering increasing your budget: the most effective B2B companies spend 42% of their overall marketing budget on content marketing.
According to this post by Michelle Lynn of the Content Marketing Institute, the average mid to large-sized business should expect to budget somewhere in the neighborhood of $12K to $32K per month.
Chart courtesy of the Content Marketing Institute
While these numbers are useful, keep in mind that depending on the size of your business, the industry you're in and your content marketing goals, your numbers may be very different.
Coming up with a budget for content marketing isn't as simple as you might imagine, but it's definitely possible. Understanding how other businesses are assigning costs, and how much they're spending - both in terms of hard numbers and as a percentage of overall marketing - can help.
How are you calculating your content marketing budget for 2016? Share below!