If you take social media seriously, you should have a budget for your ad spend. This can help you put a plan you can follow in place. It will show you what ads you can place and at what cost. An advertising budget will also give an idea of the return on investment to expect from your campaign.
However, top social media pages‘ advertising budgets can range from a couple of dollars to tens of thousands. How do you allocate a budget for your social media advertising? Join us as we answer this and other related questions.
Factors to Consider When Setting an Advertising Budget
The size of your advertising budget will depend on various factors, such as:
- How much money will achieve your desired output
- The buying decisions of your target audience
- The kind of campaigns you want to run
- Business size and industry
- How big do you want to grow your social media presence?
- The type of ads you want to create(images or videos)
- The number of professionals in your social media agency.
Common Costs Associated With Social Media Advertising
The amount of ethical spend on your social media advertising budget will depend on your needs. However, there are several items that most budgets have. These include:
A successful social media marketing budget should have content creation at its heart. This is important as you must create content your audience will easily resonate with. Some of the costs associated with content creation are:
- Images Photography
- video shooting and production
- The hiring of talents such as models and actors
- Graphics designers
Tools and Software
There are various technological tools you need to create a good campaign. This may include a project management tool, video editing software, a social media monitoring tool, or a post-scheduling tool. The price of this software will vary depending on the size of business and your advertising goal.
You should ensure your employees are up to speed with the best social media advertising practices. Therefore, your budget spend should also include employee training.
Cost of Influencer Partnership
One of the ways that you can skyrocket your social media results is by finding an influencer. Influencers can help you reach a new demographic and your brand to gain more trust among consumers. However, you will still need to pay influencers; therefore, they should be within your budget.
The price of an influencer will depend on various factors, such as:
- Your industry
- How big the influencer is
- Type of content they will create
- Type of collaboration you want with them
How Much Should You Invest in Your Social Media Ad?
No matter your social media strategy, you should have an advertising budget. This should specify how much you plan to spend on social media over a specified period, such as monthly, quarterly, or yearly. Having the budget will help you understand the cost of running an ad campaign.
As noted earlier, there are no hard rules on how much you should spend on an ad budget because each business is different. The amount will instead depend on the factors outlined earlier, such as your business and industry, business goals, and revenues.
A CMO study shows that most companies spend 8.7% of their budget on social media advertising. However, the studies also show that most businesses are increasing their budget spending to as high as 15% of their revenues.
Testing things is the best way to determine your social media advertising budget. Instead of using your entire budget in ads, you can try things with a small amount. You can know whether a specific social media network is worth it by spending $20 to $50 daily on your social media marketing budget. This can help you save on your social media marketing budget.
General Budget Guidelines to Remember
When allocating social media budgets, you should remember these general guidelines:
- B2B companies usually commit 2-5% of their revenue to the marketing budget.
- Businesses in the consumer goods industry allocate 28% of their marketing budget to social media marketing, communication, and media allocate 25.6%, while banking and finance allocate 17.6% of their marketing budget to social media.
You must understand your budget before launching your first social media ad campaign. The budget size will depend on several factors, such as your business size, overall advertising goal, and the type of ad you want to create. By following this guide, you can create a social media budget with a high ROI on your branding adventure.